SDLT and bare ownership in Italy

[AGoodman]

https://www.blakemorgan.co.uk/wp-content/uploads/Downloads/Stamp-Duty-Land-Tax-First-Time-Buyers-Relief-29052019.pdf

[gmmaio94]

FA 2003 Sch 4ZA para 16(2)(a) specifically provides that references to "major interest" in a dwelling are to an equivalent interest in a dwelling under the law of that country or territory.

Sch 4ZA para 11 provides that where a person is a beneficiary under a settlement and the beneficiary is entitled to occupy the dwelling for life then the beneficiary (not the trustee) is to be treated as holding the interest in the dwelling.
In such a case the beneficiary will have an interest in possession.

HMRC have confirmed (albeit for IHT) that in principle it will usually treat a usufruct (the right to use and enjoy another's property) as an interest in possession trust for inheritance tax (IHT) purposes. There is no reason to believe they would adopt a different approach for SDLT.

Accordingly, as you are not the interest in possession beneficiary under the Italian usufruct you are not treated as having a major interest in the Italian property.

Hence, no 3% SDLT charge.


Unless the solicitor is able to produce a cogent counter argument to the contrary he/she has no grounds for forcing you to incur the additional 3% charge. A suggestion from him/her that you could pay the 3% and then reclaim if appropriate is not a satisfactory response. A confirmation from you in writing as to the nature of your position re the Italian property together with the above argument should be sufficient to cover their "backside" which is in effect what they are worried about.

Hi Maths, I am in the same situation as this person now in 2026. Would you have an email address I can contact you in private? Happy to pay for any compensation. Thanks