Revenue Scotland has revised its view on the application of Schedule 13 of the Land and Buildings Transaction Tax (Scotland) Act 2013 (‘LBTTA’) to cases where a charity is one of a number of buyers who are or will become common owners. We now accept that Charities relief from LBTT may be claimed for the charity’s (or charities’) pro indiviso share(s) of the relevant land transaction.
In reaching this view, we have considered matters raised in the Upper Tribunal (Tax and Chancery Chamber) and at the Court of Appeal in the case of (1) The Pollen Estate Trustee Company Limited and (2) King’s College London v HMRC (‘Pollen’), in relation to the UK Stamp Duty Land Tax. The Pollen judgement raised questions about consistency of policy and how the statute should be interpreted as a result. Although there are similarities between the LBTTA and the UK legislation, we neither accept nor refute the possible application of the Pollen judgement to LBTT and consider that remains uncertain. But we have reviewed the potential implications of the matters discussed in Pollen and the application of LBTTA Schedule 13 in cases of common ownership.
We have concluded that the preferred reading of Schedule 13 allows the application of its provisions to one or more, but not all, parties entering into common ownership, based on the individual interests of the different parties. Accordingly, we will no longer refuse claims to partial Charities relief in such cases where appropriate criteria are met.
We have amended our guidance to reflect this new position and to explain how to calculate partial Charities relief.
Where partial Charities relief could have been claimed but was not, this may be claimed now. If the relevant return is still available for amendment online (within twelve months), the return may be amended online. If this is not possible, or if relief was claimed and refused, please write to us at, Revenue Scotland, PO Box 24068, Victoria Quay, Edinburgh, EH6 9BR, setting out the circumstances and how much relief is now being claimed. Please remember to quote the RS number of the relevant return in all correspondence.