Introduction Calculation of minimum amounts for the purposes of the minimum consideration rule
62.Schedule 2A Paragraph 13 sets out the meaning of first minimum amount and how this is calculated for the purposes of paragraph 12.
63.Sub-paragraph (1) provides that the “first minimum amount” (see paragraph 12(2)(b)) is in respect of a chargeable interest that is acquired under a land transaction (see paragraph 4(4) and 9(2)): (i) the amount of consideration for the subject matter of the original contract (if the whole of the subject matter of that contract is acquired); or (ii) the amount of consideration just and reasonably apportioned (if a part of the subject-matter of the original contract is acquired).
64.Sub-paragraph (2) provides that if certain conditions are met (see sub-paragraph 3) the first minimum amount is total of any consideration required to be given by the transferor (the first T – see sub-paragraph (4)) under the terms of the contract for the first T’s acquisition (see sub-paragraph (5)) of the subject matter of that contract and, if not included, any consideration required to be given by the first T under any pre-completion transaction where the first T is a transferee.
65.Sub-paragraph (3) sets out the conditions that need to be met for the first minimum amount to apply.
66.Sub-paragraph (4) sets out the meaning of “the first T” for purposes of paragraph 13.
67.Sub-paragraph (5) provides a definition of “the transfer to the first T” for the purposes of paragraph 13(2). It is the pre-completion transaction where the first T is a transferee or the original contract (if T (see Condition B in sub-paragraph (3)) is the original purchaser).
68.Sub-paragraph (6) provides the meaning of “original contract” and “tax advantage” for the purposes of this paragraph.