HMRC has clarified uncertainty surrounding the department's confusing approach to the availability of Stamp Duty Land Tax (SDLT) group relief.

It followed meetings with the British Property Federation, CIOT, the Law Society and the Stamp Taxes Practitioners' Group last month to thrash out HMRC Stamp Taxes' current approach to the availability of Stamp Duty Land Tax (SDLT) group relief, especially the application of the targeted anti- avoidance rule (TAAR) in FA 2003 Schedule 7 paragraph 2(4A), in the context of intra-group asset transfers following corporate acquisitions.

To promote greater certainty in their approach, HMRC Stamp Taxes have confirmed that where a business chooses to acquire a property-owning company as opposed to acquiring the property from that company, and thereafter, transfers the property out of the acquired company and into a different company in the group, HMRC do not regard that in itself as tax avoidance even if the acquisition of the property-owning company and the subsequent intra-group transfer of the property formed part of the same arrangements. HMRC also do not regard a subsequent liquidation, winding-up or striking-off of the acquired company in itself as tax avoidance even if the liquidation, winding-up or striking-off formed part of the same arrangements.

HMRC has, however, added a caveat that the presence of steps in addition to those described above may suggest, when taken together, that there are arrangements of which the main purpose or one of the main purposes is tax avoidance.

More details are available from HMRC