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I noticed in the latest post Patrick mentioned that, provided there is no assumption of the debt on a land transaction, there is no chargeable consideration under s. 54 and para 8 4th Sched FA 2003 (as amended). I have a family (father mother & son) owning in 79/1/20 % subject to a charge secured on the land (joint & several covenants with chargee). The father proposes to give 39% to the son. 39% of the debt secured would exceed ?150,000.
Para 8(1)(B) makes clear that the deemed share of the debt as consideration is calculated on the shares before and after the transaction. However, I read para 8(1)(A) as stating that PROVIDED there are no changes in the liabilities in respect of the charge after the transaction, no debt is assumed and so there is no consideration. I have proposed an indemnity by the father in the gift in respect of 30/79 of the debt. Can anyone see that this logic is flawed? I remember that SP6/90 mentioned this situation under Stamp Duty but the SDLT manual does not make clear that an indemnity will avoid the problem.
