Finance Act 2003, section 43

Land transactions

Part 4 Stamp duty land tax

(1) In this Part a “land transaction” means any acquisition of a chargeable interest. As to the meaning of “chargeable interest” see section 48.

(2)Except as otherwise provided, this Part applies however the acquisition is effected, whether by act of the parties, by order of a court or other authority, by or under any statutory provision or by operation of law.

(3)For the purposes of this Part—

(a)the creation of a chargeable interest is—

(i)an acquisition by the person becoming entitled to the interest created, and

(ii)a disposal by the person whose interest or right is subject to the interest created;

(b)the surrender or release of a chargeable interest is—

(i)an acquisition of that interest by any person whose interest or right is benefitted or enlarged by the transaction, and

(ii)F48a disposal by the person ceasing to be entitled to that interest; ...

(c)the variation of a chargeable interest[F49 (other than a lease)F49] is—

(i)an acquisition of a chargeable interest[F49 (other than a lease)F49] by the person benefitting from the variation, and

(ii)a disposal of a chargeable interest[F49 (other than a lease)F49] by the person whose interest is subject to or limited by the variation.

[F50 (d)the variation of a lease is an acquisition and disposal of a chargeable interest only where

[F51 (i)F51] it takes effect, or is treated for the purposes of this Part, as the grant of a new lease[F52 , or

(ii)paragraph 15A of Schedule 17A (reduction of rent or term) applies.F52,F50]]

(4) References in this Part to the “purchaser” and “vendor”, in relation to a land transaction, are to the person acquiring and the person disposing of the subject-matter of the transaction.

These expressions apply even if there is no consideration given for the transaction.

(5)A person is not treated as a purchaser unless he has given consideration for, or is a party to, the transaction.

(6) References in this Part to the subject-matter of a land transaction are to the chargeable interest acquired (the “main subject-matter”), together with any interest or right appurtenant or pertaining to it that is acquired with it.

Definitions used in section 43 5

the acquisition

(b) with the substitution in subsection (5)(b) for “the acquisition” of “the day appointed under paragraph 3(2) of Schedule 22 to the Finance Act 2003” .

Defined in Sch.22 para.3(3) · see it in the full Act
chargeable interest

(1) In this Part “chargeable interest” means—

(a)an estate, interest, right or power in or over land in England ... or Northern Ireland , or

(b)the benefit of an obligation, restriction or condition affecting the value of any such estate, interest, right or power,

Defined in s.48(1) · see it in the full Act
the court

(2) For this purpose “the court” means—

(a) in relation to an order made by a circuit judge, the Crown Court;

(b) in relation to an order made by a sheriff, a sheriff court;

(c) in relation to an order made by a county court judge in Northern Ireland, a county court in Northern Ireland.

Defined in Sch.13 para.40(2) · see it in the full Act
statutory provision

“statutory provision” means any provision made by or under an Act of Parliament, an Act of the Scottish Parliament or any Northern Ireland legislation;

Defined in s.121 · see it in the full Act
lease

5 In paragraphs 3 and 4 “lease” means any arrangements that provide for a ship to be leased or otherwise made available by one person to another.

Defined in Sch.32 para.5 · see it in the full Act

Cases considering section 43 18

Michael Brown & Anor v The Commissioners for HMRC

[2024] EWCA Civ 92 · 8 February 2024Defines

Section 43 was used to identify a land transaction as the acquisition of a chargeable interest, including in the notional world under section 75A. (see paras [21]; [66]-[67]; [72]) Section 43(1) was applied to confirm that the chargeable transaction in the determination was the acquisition of the property, whether the acquisition was analysed as actual or notional. (see paras [67]; [72])

Project Blue Ltd v Revenue and Customs

[2016] EWCA Civ 485 · 26 May 2016Defines

A land transaction is an acquisition of a chargeable interest. The Court treated the acquired interest, rather than the disposition, as the focus of SDLT analysis. (see paras [5], [9], [16]-[17]) The charge applies however the acquisition is effected. The Court used this broad scope in analysing the statutory treatment of the simultaneous contracts. (see para [5]) Creation of a chargeable interest is treated as an acquisition by the person becoming entitled and a disposal by the person whose interest is affected. The provision formed part of the statutory framework, but the appeal turned principally on sections 45 and 71A. (see para [5]) Vendor and purchaser refer to the persons disposing of and acquiring the subject matter. The Court used this definition to identify the vendor under the deemed secondary contract. (see paras [5], [30]) A person is not treated as a purchaser unless consideration is given or the person is party to the transaction. The provision was part of the statutory framework for identifying purchasers. (see para [5]) Cited only.

HM Revenue and Customs v DV3 RS Ltd Partnership

[2013] EWCA Civ 907 · 25 July 2013Interprets

A land transaction is any acquisition of a chargeable interest. The provision focuses on what the purchaser acquires, and an interest transferred under general property law need not have been a chargeable interest in the transferor's hands (see paras [20]; [23]; [33]). The court noted that an acquisition may occur without any act of the parties, supporting its focus on the statutory characterisation of the acquisition (see paras [6]; [23]). The defined vendor is the person disposing of the subject matter of a land transaction. Calling the company the transferor did not establish that it was a vendor disposing of a chargeable interest (see paras [23]; [29]). Cited only.

What each judgment says about section 43 is in the case-law panel in the full Act.

Amendments and notes

6 notes from legislation.gov.uk

Amendments

  1. F48Word in s. 43(3) repealed (with effect in accordance with Sch. 39 para. 13 of the amending Act) by Finance Act 2004 (c. 12), Sch. 42 Pt. 4(2)
  2. F49Words in s. 43(3)(c) inserted (with effect in accordance with Sch. 39 para. 13(3)-(6) of the amending Act) by Finance Act 2004 (c. 12), Sch. 39 para. 2(a)
  3. F50S. 43(3)(d) inserted (with effect in accordance with Sch. 39 para. 13(3)-(6) of the amending Act) by Finance Act 2004 (c. 12), Sch. 39 para. 2(b)
  4. F51Words in s. 43(3)(d) renumbered as s. 43(3)(d)(i) (with effect in accordance with s. 297(9) of the amending Act) by Finance Act 2004 (c. 12), s. 297(2)
  5. F52S. 43(3)(d)(ii) and word inserted (with effect in accordance with s. 297(9) of the amending Act) by Finance Act 2004 (c. 12), s. 297(2)

Commencement

  1. I16Pt. 4 wholly in force at Royal Assent subject to Sch. 19, see s. 124, Sch. 19 para. 1(1)