Stamp duty in the UK used to be an almost immaterial issue in property transactions with many clients opting to leave the transactions 'unstamped' and hence the duty unpaid. All that changed with the introduction of Stamp Duty Land Tax on 1st December 2003 which, combined with the rise in property values, led to a swelling of the coffers of the UK government to almost £10 billion from SDLT in the 2004/05 year.
- Q.
- What is the broad difference between the SDLT on a direct real estate transaction and a transaction in the shares in a single purpose corporate vehicle?
- A.
- Stamp duty is levied at the rate of 4% on all but the smallest of land transactions, while the duty on share transfers is only 1/2%. That's a differential of 3.5%.