Introduction Background Note
11.“Rent to shared ownership” (generally known as “Rent to Homebuy”) is a scheme under which the grant of a shared ownership lease (or the declaration of a shared ownership trust) is preceded by the grant of an assured shorthold tenancy at a subsidised rent in order to allow the tenant to occupy the property while saving for a deposit.
12.Depending on the details of the scheme and the amounts of consideration involved, the stamp duty land tax (SDLT) rules may result in unexpected liabilities at a time when the purchaser is least able to bear them.
13.In particular, a charge may arise retrospectively on the assured shorthold tenancy (and any other preceding land transaction) when the shared ownership lease is granted or the shared ownership trust is declared. In some other cases, the shared ownership lease (or shared ownership trust) may become chargeable when the tenant takes up occupation under the assured shorthold tenancy, but before the lease is granted (or the trust is declared).
14.This Section simplifies the SDLT treatment of these schemes so that a charge arises only on the shared ownership lease when it is granted, or on the shared ownership trust when it is declared.