In 2006, a professor bought a house in London with assistance from the college that employed him. This was a ‘shared equity’ scheme that Mills & Reeve helped to pioneer many years ago, and that is now widely used across the sector.
There are many variants to the scheme but basically the employer contributes part of the purchase price and takes a proportionate share in the equity. Usually, the staff member has the opportunity to buy out the institution in the future.
The college is of course a charity and expected to claim SDLT charities relief on its equity share. Unfortunately, the professor’s solicitors, who were responsible for making the SLDT return, wrote to HM Revenue & Customs to ask its opinion. It responded that the college was not entitled to charities relief, because it had bought the house jointly with the professor…
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