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Ministerial Directions for Land Transaction Tax

‚ÄčAbout Ministerial Directions

Under Article 13 of the Taxation (Land Transactions) (Jersey) Law 2009, the Minister for Treasury and Resources may issue directions to both the Comptroller of Revenue and the Judicial Greffier as to the exercise of their respective discretions in relation to Land Transaction Tax and Stamp Duty.

The Comptroller and the Judicial Greffier will have regard to any directions when they consider if, and to what extent, they exercise this discretion.

Directions which have been issued by the Minister apply equally to Comptroller of Revenue and the Judicial Greffier unless otherwise stated.

Stamp Duty and Land Transaction Tax Direction 2023/01: Reducing the higher rate of Stamp Duty and Land Transaction Tax

The following Direction is made by the Minister for Treasury and Resources to the Comptroller of Revenue and the Judicial Greffier using powers given to him under Article 13 of the Taxation (Land Transactions) (Jersey) Law 2009 and Article 6 of the Stamp Duties and Fees (Jersey) Law 1998. The Direction outlines the circumstances that may be considered by the Comptroller or Judicial Greffier in respect of reducing, in limited cases, the higher rate of Stamp Duty or LTT charged on the acquisition of a dwelling.

The 'higher rate' applies to a transaction described in Article 3(1)(a) or (b) of the Taxation (Land Transactions) (Jersey) Law 2009 or Schedule 1, 2 or 3 of the Stamp Duties and Fees (Jersey) Law 1998 which relates to land on which there is a dwelling that is acquired for a purpose other than use as the main residence of the person to whom the share or property is transferred. 'Main residence' means the property that is occupied as the person's main residence, whether or not it is in Jersey. However, it is recognised that in individual instances, the Comptroller or Judicial Greffier may consider it just to reduce the higher rate of Stamp Duty or LTT to the standard rate.

The Minister directs that in circumstances related to specific acquisitions of a dwelling by a family member where the dwelling is to be occupied as a main residence by another family member, the Comptroller or Judicial Greffier should consider if it is just to reduce the higher rate of Stamp Duty or LTT to the standard rate, in situations where it is demonstrable that the individual who shall occupy the property as their main residence:

  • lacks capacity as per Article 4 of the Capacity and Self-Determination (Jersey) Law 2016
  • is prone to substance abuse or compulsive gambling and the holding of the property in the family member's name is deemed to be a protective measure
  • is doing so in order to escape an abusive or dangerous spouse or partner
  • suffers from serious ill-health in a mental or physical capacity and the acquisition of the property is done so as to care for the individual and their wellbeing
  • has been left without their place of residence following an accident or natural disaster
  • has been left without their place of residence following the end of a marriage, civil partnership or relationship

In general, this Direction aims to offer the potential of a reduction in the higher rate of Stamp Duty or LTT charged on the acquisition of a dwelling when the acquisition has as its aim the protection of the individual who shall be living in the property. This Direction is not intended to apply in normal situations when a family member purchases a property for another family member, or when the property is purchased as an investment.

The Minister acknowledges that each situation is fact specific and that there may still be circumstances where the imposition of the full charge is appropriate.

Stamp Duty and Land Transaction Tax Direction 2023/02: Application of the contract price to off-plan purchases

The following Direction is made by the Minister for Treasury and Resources to the Comptroller of Revenue and the Judicial Greffier using powers given to him under Article 13 of the Taxation (Land Transactions) (Jersey) Law 2009, relating to Article 8 of that Law and Article 6 of the Stamp Duties and Fees (Jersey) Law 1998. The Direction outlines the circumstances that may be considered by the Comptroller or Judicial Greffier in respect of the value on which the rate of Stamp Duty or LTT charged on the acquisition of a dwelling where it has been purchased based on an off-plan agreement.

The value of a transaction for LTT and Stamp Duty purposes is the higher of the amount of consideration payable under the transaction or the gross value of the land to which the transaction relates. Paragraph 1 of the Schedule to the LTT Law states that gross value for these purposes is equal to market value.

The Minister recognises that, for a number of reasons outside the control of the parties to the transaction in question (including in recent times the delays to the construction of properties caused by the COVID-19 pandemic), the gross value of land in Jersey may have increased between the time of entering into a contract and completion of that contract to an extent that could not have been anticipated by the buyer or seller at the time they entered into the transaction.

The Minister directs that where the conditions described below are met, the Comptroller or Judicial Greffier should consider if it is just to proceed as if the "market value" for the purposes of LTT Law and Stamp Duty Law was the consideration payable under the original transaction contract. The conditions are:

  • the land subject to the transaction is or will be occupied for domestic purposes only
  • the sale and purchase contract cannot be assigned by the buyer and includes clauses whereby a deposit payable by the buyer is forfeited, and/or liquidated damages are payable by the buyer in the event that the buyer does not complete the transaction
  • the consideration payable under the transaction contract has been fixed at a specified amount which was equal to or above market value at the time the contract was entered into
  • the transaction contract was entered into on or after 1 January 2017

The Minister acknowledges that each situation is fact specific and that there may still be circumstances where the market value at the time of completion is appropriate.

The Minister intends to bring law to the Assembly before 31 December 2023 with a view to addressing the underlying concerns, and at such time will seek to grandfather the treatment under this direction for contracts entered into before any law change.

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