A quick scan of the Budget 2011 papers reveals a couple of small SDLT changes taking immediate effect. These include new rules aimed at preventing the combination of sub-sale treatment and alternative property finance relief from being used as a vehicle to avoid SDLT, and new rules preventing the manipulation of values on exchanges in order to avoid SDLT. In addition, a new SDLT relief in the Finance Bill will have the effect of unlinking linked residential property transactions (bulk purchases of dwellings) so that the taxpayer will pay SDLT on each acquisition at the rate of tax applicable to the average purchase price of the linked transactions, rather than at the rate that would be applicable on the aggregated purchase prices. The rule that six or more separate dwellings are to be treated as non-residential property (section 116(7) FA 2003) is disapplied for this purpose.
There is no change to the scheduled increase of the top rate of SDLT for residential property transactions. From April 6 2011, a 5% rate applies to residential property transactions where the chargeable consideration exceeds £1m.