Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017 section Schedule 16 paragraph 12

Change in control of the buyer — tracing back through previous relieved transactions

Schedule 16 paragraph 12 deals with the withdrawal of group relief where there is a change in the control of the buying company and there is a chain of earlier relieved transactions involving the same chargeable interest.

• Where the buyer company undergoes a change of control within 3 years of a relieved group transaction (or under arrangements made within that period), the rules trace back through any chain of earlier relieved transactions involving the same chargeable interest to identify the original seller.
• The group relief withdrawal rules then apply as if the original seller in the earliest linked relieved transaction were the seller in the current relieved transaction, potentially causing relief to be withdrawn if the original seller and the buyer are no longer in the same group.
• A previous transaction qualifies for tracing if it was itself relieved under group relief or reconstruction/acquisition relief, took place less than 3 years before the change of control, involved the same (or a derived) chargeable interest, and the interest has not since been acquired in a non-relieved transaction.
• A change of control caused solely by a loan creditor gaining or losing control, where all other controlling persons remain in control, is excluded from this provision.

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