Project Blue Ltd v HMRC

In Project Blue Ltd v HMRC (TC02777 – 12 July) a Guernsey company (P) agreed in 2007 to purchase the freehold of a large army barracks from the Ministry of Defence. In January 2008 P entered into a sale and leaseback agreement with a Qatari financial institution (M). Two days later M and P entered into put and call options requiring or entitling P to repurchase the freehold at the end of a ‘finance period’ (of 999 years and 2 days); the Ministry of Defence conveyed the freehold to P; P conveyed the freehold to M and M leased the property back to P for the ‘finance period’. On the following day P granted a 999-year lease to an associated company. P failed to account for SDLT on its acquisition of the property. HMRC began an enquiry and issued an amendment on the basis that SDLT was...