Stamp duty when buying a house in a trust?

[redsturgeon]

Does anyone know - If me and the wife buy a property for our disabled son in a trust, how does the stamp duty work?

A web search seems to suggest that as the beneficiary of the trust would be my son (to live in the property) that regular stamp duty would apply. BUT as me and the wife would be trustees and we already own a house jointly, would we have to pay the additional 3% Osborne stamp duty supplementary tax as well?

Hard to get a definitive answer on this from Google.

Thanks.

Fred.

Looks like you are lucky, no extra stamp duty if the beneficiary of the trust owns no other property.

http://www.telegraph.co.uk/investing/bu ... ty-for-ch/

John

[chas49]

That article also says that the exemption from the 3% additional SDLT wouldn't apply if the beneficiary is a minor (under 18).

Current guidance at https://www.gov.uk/government/uploads/s ... erties.pdf includes this:

3.38 Where an individual has absolute beneficial ownership of an interest in land but legal ownership is held by another person (as in a bare trust or nominee arrangement) the individual with beneficial ownership is treated for the purposes of Condition C to own that interest. This also applies where the beneficiary of the trust would be absolutely entitled but for being under age or disabled in a way that prevents them from being legally capable of owning property.

(Para 3 Sch 16 FA 2003 and para 11(2) and (3) Sch 4ZA FA 2003)

Unless I'm misunderstanding the guidance, that suggests the exemption does apply to a minor, or disabled adult (without legal capacity).

Can anyone clarify so future readers know if the linked article is reliable?

[PinkDalek]

...

Can anyone clarify so future readers know if the linked article is reliable?

I think the article may have been correct when written, see below, and you may well be correct on the current position but I'm always useless with legislation and haven't read the guidance notes etc (particularly the part commencing "Trustees purchasing properties" commencing 5.3).

The "Stamp duty land tax: Higher rates for purchases of additional residential properties" guidance note you linked to is dated November 2016, whereas The Telegraph article is dated 31 March 2016 and may have been based on the former guidance note. The November 2016 guidance includes "This guidance supersedes similar guidance titled `Stamp Duty Land Tax: higher rates for purchases of additional residential properties`, published on 16 March 2016".

[chas49]

I can confirm if a person meets the criteria of "disabled" then the article definitely still applies.

Can you clarify? Are you saying that a disabled beneficiary without legal capacity would NOT be allowed to be treated as the purchaser? I don't think it applies to a disabled beneficiary with capacity though...

[redsturgeon]

I can confirm if a person meets the criteria of "disabled" then the article definitely still applies.

Can you clarify? Are you saying that a disabled beneficiary without legal capacity would NOT be allowed to be treated as the purchaser? I don't think it applies to a disabled beneficiary with capacity though...

Nope, the exact opposite! The qualifying criteria is actually well defined as well in terms of DLA, PIP etc.... So, if I decide to go ahead (taking proper advice ATM) then my son would count as the purchaser despite me and Mrs Bloggs funding the purchase in the trust and being the trustees.

Seems to be the common sense approach but when did that affect tax rules?

John