HMRC SDLT: Lighthouse Land Transactions Exempt from Charge Under Merchant Shipping Act 1995

Reliefs for Lighthouse Transactions

This section explains the tax relief available for land transactions related to lighthouses, as governed by the Merchant Shipping Act 1995. Transactions conducted by specific lighthouse authorities for services funded by the General Lighthouse Fund are exempt from charges. To benefit from this relief, a claim must be made in the land transaction return.

  • Transactions by Trinity House, the Commissioners of Northern Lighthouses, or the Commissioners of Irish Lights are eligible.
  • The purpose of the transaction must be related to services funded through the General Lighthouse Fund.
  • The exemption from charges applies only to qualifying transactions.
  • Relief claims should be made using code 28 (Other reliefs) on the land transaction return.
  • Claims can be submitted either in the initial return or as an amendment to it.

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Lighthouse Transactions and Tax Relief

Understanding the Exemption

If a transaction is carried out by general lighthouse authorities, such as:

– Trinity House
– The Commissioners of Northern Lighthouses
– The Commissioners of Irish Lights

these transactions can be exempt from certain tax charges. This exemption applies when these authorities conduct a land transaction that supports services funded by the General Lighthouse Fund.

What is the General Lighthouse Fund?

The General Lighthouse Fund is a financial plan used to support various lighthouse services. These services are essential for the safety of maritime navigation and ensure that lighthouses and other aids to navigation are well-maintained and operational.

How to Claim the Relief

To claim this exemption on tax for transactions that qualify, you will need to include specific information in the land transaction return. Follow these steps:

1. Complete your land transaction return.
2. At question 9 of the return, enter the code 28 in the section designated for “Other reliefs.” This indicates you are claiming exemption based on the relevant legislation.

Example of the Exemption in Action

Let’s consider a scenario where Trinity House buys land for a new lighthouse. Since this transaction is made for the purpose of supporting maritime safety under the General Lighthouse Fund, it is exempt from tax charges. When filling out the land transaction return, Trinity House would enter code 28 to claim this relief.

Conditions for Relief

Relief under this section applies specifically when:

– The transaction is made by or under the direction of the designated lighthouse authorities.
– The purpose of the transaction aligns with the supporting services funded by the General Lighthouse Fund.

It’s important to ensure that all conditions are met before claiming this relief to avoid any issues with HMRC.

Consequences of Not Claiming Relief

If a qualifying transaction does not claim this relief, it may be subject to taxation, which increases costs for the lighthouse authority. This could limit the available funds for maintaining and upgrading essential navigation services, ultimately affecting safety at sea.

Related Information and Further Reading

For more details on this topic and others related to land transactions and exemptions, you may find it helpful to check related sections of HMRC guidance or visit other resources. Examples of other reliefs can be found [here](https://stampdutyadvicebureau.co.uk/hmrc/SDLTM29690).

In Summary

General lighthouse authorities can save costs on land transactions when they follow the correct procedure to claim relief under the Merchant Shipping Act. By understanding the qualification process, providing the necessary documentation, and ensuring that all conditions are fulfilled, these authorities can continue their vital work in ensuring safe navigation at sea without the additional burden of unnecessary taxes.

Useful article? You may find it helpful to read the original guidance here: HMRC SDLT: Lighthouse Land Transactions Exempt from Charge Under Merchant Shipping Act 1995

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