Trust purchases first dwelling for beneficiary, beneficiary's spouse already owns main residence which is not being replaced



Peter is the trustee of a settlement trust for the benefit of Stephen in liferent, with the fee to Bernard. Stephen lives in rented accommodation, funded by the trust and the trust owns no dwellings. Stephen marries Gillian and decides that he will ask the trust to purchase a main residence for him and his wife to live in. Gillian already owns a main residence and decides to retain this to use as a buy-to-let dwelling.

For the purposes of the LBTT(A)(S)A 2016, Stephen is treated as the buyer in the next main residence purchase transaction (as he is a beneficiary who has a "relevant interest" in his main residence trust property). At the end of the day that is the effective date of that transaction, he is also deemed to own the dwelling belonging to his wife.

As there has been no replacement of a main residence, the ADS will apply to the trust purchase transaction.

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