Introduction Assignment of rights: transferor deemed to make a separate acquisition
17.Schedule 2A Paragraph 5 deems the transferor as making a separate acquisition (a “notional land transaction”) where there is an assignment of rights.
18.Sub-paragraph (1) provides that where there is an assignment of rights and the original contract is either: (i) substantially performed by the transferee; or (ii) completed by conveyance to the transferee, the effective date of that land transaction is deemed to be the effective date of the notional land transaction and the original purchaser is the deemed purchaser under that notional land transaction.
19.Sub-paragraph (2) sets out that where there are preceding assignments of rights (an additional land transaction “associated with” the assignments of rights) prior to substantial performance or completion by conveyance of the original contract (an “implemented assignment of rights”) there is deemed to be an “additional land transaction” for each such assignment of rights other than the first (which is the subject-matter of the notional land transaction) with a deemed amount of chargeable consideration for each such transaction.
20.Sub-paragraph (3) provides that Schedule 4 FA 2003 applies for determining the chargeable consideration for a notional land transaction (which does not form part of a chain of transactions that are pre-completion transactions) provided that the chargeable consideration is: (i) the total consideration given under the original contract by the transferee (or anyone connected with them) (Amount A – see sub-paragraph A5(a) and (c)); and (ii) the purchaser (or anyone connected with them) under the notional land transaction (Amount B - see sub-paragraph B5(a) and (b)).
21.Sub-paragraph (4) provides that Schedule 4 FA 2003 also applies for determining the chargeable consideration where there are a series of notional land transactions (additional land transactions) provided that the chargeable consideration is: (i) the consideration given under the original contract by the transferee (or anyone connected with them), as well as any consideration given by any transferee (or anyone connected with them) in any prior completion transaction in that series (Amount A - see sub-paragraph A5(a), (b) and (c)); (ii) the purchaser (or anyone connected with them) under any additional land transaction (Amount B - see sub-paragraph B5(a) and (b)); and (iii) any consideration given in any preceding assignment of rights (see sub-paragraph (6)) by the purchaser under that transaction (or anyone connected with them) (Amount C - see sub-paragraph C5 (a) and (b)).
22.Sub-paragraph (5) sets out the rules for calculating the consideration for the notional land transaction/any additional land transactions in a series of pre-completion transactions and set outs out what is meant by Amount A, B and C in paragraph 5(3) and 5(4).
23.Sub-paragraph (6) sets out the meaning of “preceding assignment of rights” for the purposes of sub-paragraph (5).
24.Sub-paragraph (7) provides the meaning of the term “related assignment of rights” for the purposes of sub-paragraph (2).