Finance Act 2003, section 48

Chargeable interests

Part 4 Stamp duty land tax

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

(a)an estate, interest, right or power in or over land in [F67England F68... or Northern IrelandF67] , or

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

other than an exempt interest.

[F69 (1A)See section 48A regarding land which is partly in England and partly in Wales.F69]

(2)The following are exempt interests—

(a)any security interest;

(b)a licence to use or occupy land;

(c)F70...—

(i)a tenancy at will;

(ii)an advowson, franchise or manor.

(3)In subsection (2)—

(a) “security interest” means an interest or right (other than a rentcharge) held for the purpose of securing the payment of money or the performance of any other obligation; and

(b) “franchise” means a grant from the Crown such as the right to hold a market or fair, or the right to take tolls.

[F71 (3A)Section 73B makes additional provision about exempt interests in relation to alternative finance arrangements.F71]

F72 (4). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5)The Treasury may by regulations provide that any other description of interest or right in relation to land in [F73England F74... or Northern IrelandF73] is an exempt interest.

(6)The regulations may contain such supplementary, incidental and transitional provision as appears to the Treasury to be appropriate.

[F75 (7)This section has effect subject to subsection (3) of section 44A (contract and conveyance to third party) [F76 and to paragraph 15A of Schedule 17A (reduction of rent or term of lease)F76] .F75]

Definitions used in section 48 2

land

“land” includes—

(a)

buildings and structures, and

(b)

land covered by water;

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

40 In this Part of this Schedule “arrangements” includes any scheme, agreement or understanding, whether or not legally enforceable.

Defined in Sch.15 para.40 · see it in the full Act

Cases considering section 48 11

Project Blue Ltd v Revenue and Customs

[2016] EWCA Civ 485 · 26 May 2016Limits

The Court used the definition of chargeable interest and its exclusions to distinguish ownership from a conventional security interest. (see paras [6]-[9]) Section 48(1) identifies estates, interests, rights, powers and certain obligations affecting land as chargeable interests, subject to exemptions. The Court used that framework in distinguishing Ijara ownership from security. (see paras [6]-[9]) A security interest is exempt from the definition of chargeable interest. The Court held that an Ijara acquisition was not a conventional security interest and therefore could not be treated on that basis. (see paras [6]-[9]) A security interest is an interest or right held to secure payment or performance. The Court contrasted that concept with an Ijara arrangement in which the institution owns the property and leases it. (see para [7])

The Pollen Estate Trustee Company Ltd & Anor v Revenue And Customs

[2013] EWCA Civ 753 · 26 June 2013Defines

The court held that the equitable fee simple or term of years acquired collectively through the bare trustee was a chargeable interest within the statutory definition (see paras [40]-[41]).

Project Blue Limited v Commissioners for Her Majesty’s Revenue and Customs

[2018] UKSC 30 · 13 June 2018Limits

Defines chargeable interests to include estates, interests, rights and powers over United Kingdom land, subject to exempt interests. (see para [10]) Confirms that security interests are exempt. That conventional-lending exemption informed the purpose of section 71A but could not be applied directly to the Ijara transactions. (see paras [10]; [26]; [91]) Defines a security interest as one held to secure payment or performance. The Ijara structure was not to be recharacterised as such an interest. (see paras [10]; [91])

What each judgment says about section 48 is in the case-law panel in the full Act.

Amendments and notes

12 notes from legislation.gov.uk

Amendments

  1. F67Words in s. 48(1)(a) substituted (with effect in accordance with s. 29(4) of the amending Act) by Scotland Act 2012 (c. 11), ss. 29(2), (3)(b) (with s. 29(5)(6)); S.I. 2015/637, art. 2
  2. F68Words in s. 48(1)(a) omitted (1.4.2018 with effect in accordance with s. 16(4)(5) of the amending Act) by virtue of Wales Act 2014 (c. 29), ss. 16(2), 29(2)(b)(3) (with s. 16(4)(5)); S.I. 2018/214, art. 2(a)
  3. F69S. 48(1A) inserted (1.4.2018 with effect in accordance with s. 16(4)(5) of the amending Act) by Wales Act 2014 (c. 29), s. 29(2)(b)(3), Sch. 2 para. 3(2); S.I. 2018/214, art. 2(a)
  4. F70Words in s. 48(2)(c) omitted (with effect in accordance with s. 29(4) of the amending Act) by virtue of Scotland Act 2012 (c. 11), s. 44(2)(b)(3)(b), Sch. 3 para. 4(a) (with s. 29(5)(6)); S.I. 2015/637, art. 2
  5. F71S. 48(3A) inserted (19.7.2007) by Finance Act 2007 (c. 11), s. 75(2)
  6. F72S. 48(4) omitted (with effect in accordance with s. 29(4) of the amending Act) by virtue of Scotland Act 2012 (c. 11), s. 44(2)(b)(3)(b), Sch. 3 para. 4(b) (with s. 29(5)(6)); S.I. 2015/637, art. 2
  7. F73Words in s. 48(5) substituted (with effect in accordance with s. 29(4) of the amending Act) by Scotland Act 2012 (c. 11), s. 44(2)(b)(3)(b), Sch. 3 para. 4(c) (with s. 29(5)(6)); S.I. 2015/637, art. 2
  8. F74Words in s. 48(5) omitted (1.4.2018 with effect in accordance with s. 16(4)(5) of the amending Act) by virtue of Wales Act 2014 (c. 29), s. 29(2)(b)(3), Sch. 2 para. 3(3); S.I. 2018/214, art. 2(a)
  9. F75S. 48(7) inserted (with effect in accordance with Sch. 39 para. 13(1) of the amending Act) by Finance Act 2004 (c. 12), Sch. 39 para. 4(2)
  10. F76Words in s. 48(7) inserted (with effect in accordance with s. 297(9) of the amending Act) by Finance Act 2004 (c. 12), s. 297(3)

Modifications

  1. C25S. 48 modified (19.3.2025) by The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 28(6)(a) (with reg. 63)

Commencement

  1. I21Pt. 4 wholly in force at Royal Assent subject to Sch. 19, see s. 124, Sch. 19 para. 1(1)