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1. SDLT and Partnerships: an Introduction Storyboard for

2. …clear thinking

3. By completing this module you will be able to: Give positive advice to clients on SDLT payable in common situations involving partnerships and companies Advise on when SDLT arises on the creation, acquisition or sale of an interest involving a partnership Advise a client on the SDLT typical points arising owning an interest in a property holding partnership At the end, you can visit useful Internet sites on a “Web Ride” Lecturer: Julian J.B. Hickey, Tax Director, BDO LLP Learning time: approx. 20 min How to use this learning module? - Click on "Help" in the Table of Contents (TOC) Key aspects of SDLT and Partnerships Graphic: [presenter or standard graphic]

4. SDLT is a tax on UK land transactions Chargeable: Wherever documented and executed Wherever the parties reside Applies to any acquisition of a chargeable interest Acquisition includes: Creation, Surrender or release, Variation Overview: What is SDLT? Graphic: [a Georgian house being used as an office]

5. Partners in a Partnership Partnerships and higher rate SDLT does not apply to security interests, licences to use or occupy land, tenancies at will SDLT is charged on money or money’s worth SDLT is paid on VAT Overview: Who is liable? Graphic: [partners of a firm]

6. General Partnership Limited Partnership Limited Liability Partnership Foreign partnerships Necessity for a ‘business’ What is a partnership for SDLT purposes? Graphic: [a dictionary]

7. The key SDLT trigger points are: Acquisition of a chargeable interest by a partnership Transfer of a chargeable interest to a partnership in exchange for an interest in the partnership Transfer of an interest in a partnership Transfer of a chargeable interest from a partnership to a partner When does SDLT apply to a partnership? Graphic: [the starter in a horse or other race]

8. Generally the partnership must be disregarded Partners treated as holding their share of the chargeable interest Land transactions treated as entered into by or on behalf of the partners Responsible partners Joint and several liability Representative partners Ordinary partnership transactions Graphic: [a pizza being sliced]

9. Contribution of real estate to a partnership: Sch 15, para 10 charge Application of the “sum of lower proportions” test/ individuals /corporations That proportion is calculated as (100 - SLP)% Para 12A election by a property investment partnership Withdrawal of capital from the partnership: para 17A Subsequent transfer of an interest in the partnership: para17 Transfer of chargeable interest to a partnership Graphic: [a chess clock]

10. Sale of a chargeable interest by a partnership Transfer of real estate from a partnership: Sch 15, para. 18 Application of the “sum of lower proportions” test/ individuals/ corporations Para 12A election by property investment partnership Transfer of chargeable interest from a partnership Graphic: [a Fire Exit sign]

11. Only SDLT when transfer of an interest in a property investment partnership Meaning of a ‘property investment partnership’ Meaning of ‘relevant partnership property’ Chargeable consideration: market value Type A and Type B transfers Transfer of an interest in a partnership Graphic: [a building site for office under construction]

12. SDLT does not apply where group relief is available: Sch. 7 FA 2003 Partnerships and groups LLPs Group Relief Graphic: [a company „family tree“/ group structure]

13. SDLT does not apply on incorporation of an LLP s65 FA 2003 Transfer must be within 1 year of formation Mirror partner/member requirement Mirror interests No tax avoidance scheme where any change in interests Transfer to LLP Graphic: [Companies House logo]

14. The key things to remember from this module are: Identify whether a partnership exists Identify whether property is being transferred to or from a partnership Identify whether an interest is being transferred in a property investment partnership Summary Graphic: [standard summary graphic]

15. Web Ride

16. …clear thinking

17. Please select the correct answer(s) and then click on “Submit” What is SDLT charged on? The transfer of an interest in a limited liability partnership The transfer of an interest in a general partnership The transfer of an interest in a limited partnership The transfer of an interest in property investment partnership Question 1

18. Please select the correct answer(s) and then click on “Submit” When do special SDLT provisions apply to a partnership? There is an acquisition of a chargeable interest by a partnership, and the transfer of a chargeable interest from a partnership to a partner There is a transfer of a chargeable interest to a partnership in exchange for an interest in the partnership There is a transfer of an interest in a partnership Only when there is a transfer of land by a property investment partnership Question 2

19. Please select the correct answer(s) and then click on “Submit” SDLT relief is available on the formation of: A limited partnership A company A limited liability partnership A general partnership Question 3

20. Now you have finished this module and acquired basic knowledge on SDLT and Partnerships If you answered all the questions in the Quiz correctly, you can print out your personal certificate by clicking on the link Thank you for your attention! Finish Graphic: [standard finish graphic]