New legislation introduced in the March 2010 Budget with the intention of countering Stamp Duty Land Tax avoidance schemes using exemptions for transfers between partners and their partnerships may in fact have much wider implications than intended.
The stated intention of this new legislation was solely to counter artificial schemes which used exemptions for transactions between partners and partnerships to avoid paying the full amount of stamp duty land tax on a transfer. However due to the way in which this new legislation has been constructed it would appear that genuine transfers between partnerships and individual partners involving consideration being paid, but which have no tax avoidance motive, may be caught by this legislation and therefore not qualify for the original exemptions.
We understand that this issue has been raised with HMRC and that they are working on a response. It is therefore hoped that either HMRC guidance or amending legislation will be issued very shortly which will clarify the position. However in the meantime we would suggest that if you are contemplating transferring assets between individual partners and a partnership, where consideration will be paid, you should take professional advice on the matter well in advance of the transaction.
No comments have been made.