In 2006, a professor bought a house in London with assistance from the college that employed him. This was a ‘shared equity’ scheme, which Mills & Reeve helped to pioneer many years ago.
There are many variants to the scheme, but basically the employer, university or college 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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