Land transfer

A client company would like to transfer a piece of land that it owns to one of its director/shareholders.

A dividend in specie would not be appropriate and so the proposal is to transfer the land by way of benefit in kind.

For the avoidance of doubt the land is not being transferred to the director/shareholder in settlement of a bonus entitlement and as there is no intention to sell the land it would not seem to be a ‘readily convertible asset’ (RCA).

We had assumed that this should be entered on form P11D with the tax payable under self assessment seemingly in accordance with booklet 480 paragraph 6.9.

However the Employment Income Manual at EIM21640 seems quite clear that where an asset is transferred from an employer tax is chargeable under ITEPA 2003 s 62 on ‘money’s worth’; and...