HMRC SDLT: SDLTM29825 – Conditions for claiming the relief – relevant consideration is not more than £625,000 FA03/SCH6ZA/PARA1(3)

Conditions for Claiming Relief

This section of the HMRC internal manual outlines the conditions under which relief can be claimed when the relevant consideration does not exceed £625,000, as per FA03/SCH6ZA/PARA1(3).

• Relief is applicable when the consideration is £625,000 or less.
• Guidance is provided for HMRC staff on processing claims.
• Includes specific legislative references for clarity.
• Ensures compliance with the Finance Act 2003.

Understanding SDLTM29825 – Conditions for Claiming Relief

Overview of Relief Availability

In order to claim relief on a transaction, the relevant consideration must not exceed £625,000. This figure is important as it determines whether you can take advantage of certain reliefs available in the Stamp Duty Land Tax (SDLT) system.

What is Relevant Consideration?

Relevant consideration includes all the usual amounts considered when calculating the chargeable consideration for SDLT. However, it’s important to note that any rent payable under a lease does not factor into this amount.

Transactions and Their Links

The £625,000 limit applies differently depending on whether a transaction is linked to others:

– Single, Unlinked Transaction: If a transaction stands alone and is not connected to any other transactions, the full £625,000 limit applies only to that particular transaction.

– Linked Transactions: If a transaction is part of a group of linked transactions, the relevant consideration looks at the total chargeable consideration for all those linked transactions combined. If the total exceeds £625,000, none of the transactions will qualify for relief.

Examples of Relevant Consideration

To make this clearer, let’s look at a couple of examples:

– Example 1: Unlinked Transaction
Suppose you buy a property for £600,000. Since this amount is below £625,000, you would qualify for relief.

– Example 2: Linked Transactions
Now imagine you are purchasing two properties. The first property is worth £500,000, and the second is worth £200,000. In this case, the total relevant consideration is £700,000 (£500,000 + £200,000). Because this amount exceeds £625,000, you would not qualify for any relief on either property.

Important Considerations in Relief Claims

When applying for relief, consider the following:

1. Identify All Transactions: Ensure you identify all relevant transactions that may be linked. This includes looking into past transactions that could affect the current claim.

2. Verify Chargeable Consideration: Understand how chargeable consideration is calculated. This involves knowing what elements contribute to the overall figure.

3. Review SDLT Guidance: For detailed guidance on chargeable consideration, refer to SDLTM03700 onwards. This will provide you with additional details on how to assess relevant consideration appropriately.

Definitions of Key Terms

– Relief: A reduction in the amount of tax owed, available under certain conditions.
– Chargeable Consideration: The total value taken into account when calculating liability for SDLT, excluding any rent under lease agreements.

Further Reading and Guidance

If you require more information about the rules and regulations regarding SDLT and how to claim relief, you can visit the following links:

– For details on chargeable consideration and its implications, refer to SDLTM03700 onwards: https://stampdutyadvicebureau.co.uk/hmrc/SDLTM03700.Title of page: SDLTM03700 – Guidance on Chargeable Consideration

By understanding these key points, you can better navigate the conditions for claiming relief under the SDLT regulations, ensuring compliance with the latest guidelines.

Useful article? You may find it helpful to read the original guidance here: HMRC SDLT: SDLTM29825 – Conditions for claiming the relief – relevant consideration is not more than £625,000 FA03/SCH6ZA/PARA1(3)

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