Assignment of a short term lease out of freehold
Two years ago my client raised money against her business property which is used by the family limited company. A lease was apparently drawn up although my client has no real recollection of this and the solicitor is now no longer in business. I was not consulted on the transaction. I guess that the lease was requested by the bank.
Move forward two years and the client is now under enquiry. The SDLT form is in the hands of the HMRC officer.
Having done a land registry search it is apparent that there is a 20 year lease. No rent or premium changed hands.
The inspector has said that because the granting of the lease was not "by way of a bargain made at arms length" then the company is deemed to have acquired the lease at market value and paid the "appropriate premium".
His argument sounds logical. I assme that he is technically correct?
He also states that "none of the deemed premium will be chargeable to tax under schedule A and the whole of the deemed premium will be brought into the computation of the gain arising on the grant of the lease". I assume that this is correct?
Is it possible to assign a market value to the premium?
I assume that I will need to get a professional valuer involved?
It would be appreciated if anyone can point me in the right direction?
- PITA ex-client 101 7
- Tax on free shares 14 1
- CTA and Tolley's tax handbooks 320 8
- Audit 395 13
- Can I contribute to SIPP if I pay no salary/dividend from ltd company 295 4
- What font do you prefer to use for correspondence? 56 3
- What quality paper do you use for correspondence? 816 22
- PPR relief and half hectare rule 63 2
- Capital allowances on a 3G Pitch 227 13
- Scottish Independance 865 24
- Funding Circle experience 55 1
- Uncomfortable with some advertising Sift takes 692 20
- Awkward IP 1,489 16
- New supplier 95 2
- Sage 50 cost centre limitations 53 2
- Buying a horse?? 312 9
- How to post Sales figures in Sage50 Accounts (we use separate Sales ledger) 206 4
- Do I need to pay my accountant 1,134 12
- Straightforward email correspondence or PDF letter attached to blank email? 976 11
- What's in a name ? 1,155 9
- CTA study material 792
- Anyone have clients that use Pay4Later to offer customers credit? 489
- Raiders of the Lost Tax File 442
- Employment related securities question 315
- AIM Stocks and IHT 294
- Expat pension contributions? 275
- Tax Relief for overseas employees 272
- Trust for Employee 252
- Service Charge Accountant Career Options 214
- IPP (International Pension Plan) income 155