We have a situation where a trust beneficiary who is occupying a UK dwelling held by the trustees, by virtue of an interest in possession, is in the process of buying personally a new build dwelling from a developer, which she intends to occupy.
The trustees plan to make the dwelling held by them available in part exchange for the beneficiary’s new purchase.
The question has arisen of whether the SDLT relief for developers acquiring a dwelling in part exchange, per Finance Act 2003 Schedule 6A, para 2, would be available in these circumstances. From our reading, as the beneficiary has no legal title to the current dwelling, it appears that the developer’s acquisition of it would not qualify for this relief. The SDLTM does not appear to cover this situation. Do others agree?
Would the appointment of the beneficiary as a trustee before entering into the part exchange affect the position?