Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017 Schedule 7 paragraph 36

Election to disapply special partnership transfer rules for property-investment partnerships

Schedule 7, paragraph 36 allows a property-investment partnership to elect out of the special rules that normally apply when a chargeable interest is transferred into the partnership, so that the transaction is instead taxed as an ordinary partnership transaction at market value.

• When a chargeable interest is transferred to a property-investment partnership, the buyer (the partnership) can elect for the special partnership transfer-in rules under paragraph 13 not to apply, meaning the transaction is treated as an ordinary partnership transaction under Part 3 of Schedule 7.
• If the election is made, the chargeable consideration is taken to be the market value of the interest transferred, and the special rules for transfers out of the partnership under paragraph 21 are also disapplied for that transaction.
• The election must be included in the land transaction tax return for the transaction, or in an amendment to that return, and once made it is irrevocable — the return cannot later be amended to withdraw it.
• If the election is made by amending the return, it takes effect as if it had been made on the original filing date, and returns for any related transfer-of-interest transactions (under paragraph 34) with an effective date on or after the main transaction may also be amended to reflect the election.