Sub Sale

Would like to understand the sub sale process.
If A buys land from B and A in turn sells a piece of the land to C via "sub sale".
Questions:
1) A will pay B price of the full plot of land. Yes?
2) A will pay Stamp Duty only on the price of the land less the price of the land sold to C. Yes?
3) C will then pay Stamp Duty on the value of the land purchased from A? Yes?
4) Do the two Stamp Duty transactions necessarily have to be registered at the same time to ensure A does not have to pay SD on the value of the full plot?

Thanks

mickeyg said:

Would like to understand the sub sale process.
If A buys land from B and A in turn sells a piece of the land to C via "sub sale".
Questions:
1) A will pay B price of the full plot of land. Yes?
2) A will pay Stamp Duty only on the price of the land less the price of the land sold to C. Yes?
3) C will then pay Stamp Duty on the value of the land purchased from A? Yes?
4) Do the two Stamp Duty transactions necessarily have to be registered at the same time to ensure A does not have to pay SD on the value of the full plot?

Thanks

Click to expand...

Theres only one stam duty hit.

Sub sale is used where a developer does not want to pay stamp duty.

Basically Stamp duty arises on the conveyance or transfer of land.

In a subsale situation The person who owns the land contracts to sell the land to the developer. The developer does not pay stamp as property is resting on contract.
The developer develops the site. The developer then gets the landowner to convey the site to the eventual buyer of the property.At this stage the buyer has to pay stampduty and usually its lower that the 9%.

One point though. sub sale might not be an option if the development consists of apartments.
Hope this helps