Repayment of SDLT due in respect of contingent consideration

The taxpayer (PBL) had bought a property from the Ministry of Defence (MoD) for about £1bn with the assistance of Islamic finance. In the related stamp duty land tax returns PBL claimed there was no liability to stamp duty land tax because of the sub-sale relief provision in FA 2003 s 45(3). A return lodged by the finance provider claimed ‘alternative property finance relief’ under s 71A.

In brief after the matter proceeded through the courts the Supreme Court ruled that stamp duty land tax was due. However that part of the consideration was contingent consideration so while stamp duty land tax was due it was subject to repayment if that contingent consideration was never paid.

The taxpayer subsequently claimed a repayment of stamp duty land tax it had overpaid in relation to the contingent consideration. HMRC refused the claim.

The First-tier Tribunal was satisfied...