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(1) In Schedule 9 to the Finance Act 2003 (stamp duty land tax: right to buy, shared ownership leases etc), after paragraph 4 insert—“Shared ownership lease: treatment of staircasing transaction4A
(1) This paragraph applies where under a shared ownership lease—
(a) the lessee or lessees have the right, on the payment of a sum, to require the terms of the lease to be altered so that the rent payable under it is reduced, and
(b) by exercising that right the lessee or lessees acquire an interest, additional to one already held, calculated by reference to the market value of the dwelling and expressed as a percentage of the dwelling or its value (a “share of the dwelling”).
(2) Such an acquisition is exempt from charge if—
(a) an election was made for tax to be charged in accordance with paragraph 2 or, as the case may be, paragraph 4 and any tax chargeable in respect of the grant of the lease has been paid, or
(b) immediately after the acquisition the total share of the dwelling held by the lessee or lessees does not exceed 80%.
(3) In this paragraph “shared ownership lease” means a lease granted—
(a) by a qualifying body, or
(b) in pursuance of the preserved right to buy,
in relation to which the conditions in paragraph 2(2) or 4(2) are met.
(4) Section 118 (meaning of “market value”) does not apply in relation to the references in this paragraph to the market value of the dwelling.”.
(2) In sub-paragraph (1) of paragraph 5 of that Schedule (meaning of “qualifying body” and “preserved right to buy”) for “2 and 4” substitute “2, 4 and 4A”.
(3) In Schedule 19 to that Act (stamp duty land tax: commencement and transitional provisions), in paragraph 7 (earlier related transactions under stamp duty), for sub-paragraph (2) substitute—
“(2) In paragraph 3 of Schedule 9 (relief for transfer of reversion under shared ownership lease where election made for market value treatment) and paragraph 4A of that Schedule (shared ownership lease: treatment of staircasing transaction) as they apply in a case where the original lease was granted before the implementation date—
(a) a reference to a lease to which paragraph 2 of that Schedule applies shall be read as a reference to a lease to which section 97 of the Finance Act 1980 applied (which made provision for stamp duty corresponding to that paragraph), and
(b) a reference to an election having been made for tax to be charged in accordance with paragraph 2 or 4 of that Schedule shall be read as a reference to the lease having contained a statement of the parties' intention such as is mentioned in section 97(2)(d) of the Finance Act 1980 or, as the case may be, paragraph (d) of section 108(5) of the Finance Act 1981 (which made provision for stamp duty corresponding to paragraph 4).”.
(4) Subsections (1) and (2) apply in relation to an acquisition after 17th March 2004.
(5) Subsection (3) is deemed to have come into force on 1st December 2003.
This Act received Royal Assent on 22 July 2004: for provision as to the application of sub-ss (1), (2) see sub-s (4) above and for provision as to the commencement of sub-s (3) see sub-s (5) above.