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The taxpayers bought a property for £277 000 funded by a joint mortgage. On the same date as the sale contract Mr M agreed to sell all but 1% of his share in the property to Mrs M. The aim was to engage the sub-sale provisions in FA 2003 s 45 so that the consideration fell under the stamp duty land tax threshold resulting in no stamp duty land tax being payable.
HMRC considered the arrangement did not work and raised a discovery assessment for stamp duty land tax on the full price of the property.
The taxpayers appealed.
The First-tier Tribunal considered first whether the discovery assessment was valid. It noted that HMRC had discovered the issue as a result of an investigation into the taxpayers’ agent whom it considered had been promoting stamp duty land tax avoidance schemes and indeed the firm...
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