I wonder if anyone can give a qualified answer to a query over Group Relief rules when issuing new lease.
In short, we have a small property Group, a holding company with two subsidiaries, one for development and another for longer term investments. It was set up in a group structure to enable us to move properties between companies without incurring SDLT where the ultimate ownership remained the same. We have a freehold property owned by our development business, but intend to grant leases for parts only of that property to the other subsidiary within the group at cost, so there is no gain / no loss.
Our interpretation is that Group relief would apply, but our solicitors are concerned about creating what may be seen as a new chargeable interest in the form of the leases. I have spoken with the HMRC helpline who suggested the following rule still applies, but wondered if anyone had direct experience?
"If the purchaser and vendor of a chargeable interest are companies and, at the effective date of the land transaction, they are both members of the same group, relief from stamp duty land tax may be claimed by the purchaser."
Thanks,
JCP
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