3
(1)
Subject to sub-paragraph (2), where a person acquires a chargeable interest or an interest in a partnership
as bare trustee, this Part applies as if the interest were vested in, and the acts of the trustee in relation to it were the acts of, the person or persons for whom he is trustee.
(2)
Sub-paragraph (1) does not apply in relation to the grant of a lease.
(3)
Where a lease is granted to a person as bare trustee, he is treated for the purposes of this Part, as it applies in relation to the grant of the lease, as purchaser of the whole of the interest acquired.
(4)
Where a lease is granted by a person as bare trustee, he is to be treated for the purposes of this Part, as it applies in relation to the grant of the lease, as vendor of the whole of the interest disposed of.
Cases considering Schedule 16, paragraph 3 3
[2025] EWCA Civ 1588 · 10 December 2025Limits
The paragraph contains special SDLT rules for acquisitions and lease grants involving bare trustees. Its limited deeming effect was central to the Case 3 analysis under section 75A. (see paras [23]-[24], [78], [97]-[101])
The general rule treats an acquisition by a bare trustee as an acquisition by the beneficial owner. The Court distinguished this general rule from the special lease-grant rules. (see paras [23]-[24])
The general bare-trustee rule does not apply to the grant of a lease. (see paras [23]-[24], [100])
A person receiving a lease as bare trustee is treated as purchaser of the whole interest for the purposes of the lease grant. (see para [23])
A person granting a lease as bare trustee is treated as vendor of the whole interest for SDLT purposes. The deeming did not make the trustee beneficial owner or deem it to have distributed its assets. (see paras [23]-[24], [78], [97]-[101])
[2013] EWCA Civ 753 · 26 June 2013
The deeming provision applies to the chargeable interest acquired by the bare trustee. It therefore deems the collective equitable estate, rather than each beneficiary’s separate undivided share, to be vested in the beneficiaries (see paras [17]; [39]-[41]).
[2022] UKUT 310 (TCC) · 17 November 2022
Paragraph 3 of Schedule 16 would treat acts of a trustee as acts of the beneficiary. The Tribunal considered this when upholding the finding that Mr Fox did not hold the property on trust for himself and Mrs Fox (see paras [41]-[42]; [49]).
What each judgment says about Schedule 16, paragraph 3 is in the case-law panel in the full Act.