Trade related property

Split of purchase price between shares and land

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Client is buying a hotel. The property is owned personally, but the trade ran through a company.

Client is splitting price between the property and the shares. There are then 2 contracts with third parties who are unconnected.

Do readers think that HMRC can step in and invoke their practice note on trade related properties such that the majority of goodwill attaches to the property. It is a SDLT problem.

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By Alastair Johnston
25th May 2016 16:09

Are the vendors unconnected with each other, or just with you? If they are connected with each other, it is open to HMRC to challenge the allocation of the price.

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Replying to Alastair Johnston:
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By alltaxedout
26th May 2016 09:05

Thanks
Yes, the vendors are connected.

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