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Stuart J
Stuart J, Solicitor
Category: Property Law
Satisfied Customers: 22401
Experience:  PGD Law. 20 years legal profession, 6 as partner in High Street Practice
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I have a limited company that has land worth 420,000 without

Customer Question

I have a limited company that has land worth 420,000 without any mortgage over it. The company has had bad credit rating and therefore cannot get any funding for development /construction. I wish to sell the property to another company which is owned by my wife and son so that they can obtain credit and complete construction.
Q 1. Is there any way I can transfer the property to the other company without payment of land Tax.
Q 2 Can I sell the land at a lower then purchase price as I cannot build on it due to lack of funding and also due to restricting from Thames Water (consideration).
Q 3 Can the new company acquire my company with all its assets and liabilities at say £250k.will I be breaking any law if I agree to sell my company at that price.
Q 4 Any other suggestion to get round this problem I do not wish to pay £12,600 in Land tax.
Submitted: 3 years ago.
Category: Property Law
Expert:  Stuart J replied 3 years ago.




it is the purchase which pays the land tax not the sale.

The only way of doing this is to sell the shares in the limited company
because that only attracts stamp duty of 0.5%.



Obviously, if the limited company has also other assets, then that is not a
practical solution.



You can sell the land for £1 but in the limited company goes bust in the
next five years the trustee in bankruptcy will want the transaction set
aside/overturned.



If you are selling it for 1 pound, it must be a genuine arm's-length
transaction undervalue and expected to be scrutinised. It cannot be a sham of
the table dealing.



The same thing applies with regard to selling the company if it is
undervalue.



If there was a magic way of getting round paying £12,600 land tax, or any
other amount of land tax, everyone would do it



Can I help further?



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