Blue decision

The Ministry of Defence contracted on 5 April 2007 to sell some land to the taxpayer a Guernsey company for £959m. The business paid 20% of the price (£191.8m) on exchange with the balance to be paid in four instalments.

The taxpayer contracted on 29 January 2008 to sell the land to a Qatari bank and submitted an SDLT1 in respect of the transaction. The bank contracted on the same day to grant a lease of the land to the taxpayer.

The parties entered into further agreements providing for the grant of put and call options allowing the taxpayer to buy back the property at the end of a finance period of 999 years and two days.

The company claimed no stamp duty land tax was due. HMRC disagreed saying FA 2003 s 75A applied to the transaction and the chargeable consideration was...