The Tower One St George Wharf Limited (Appellant) v Commissioners for His Majesty's Revenue and Customs (Respondent)

Case summary

Case ID

UKSC/2026/0015

Parties

Appellant(s)

The Tower One St George Wharf Limited

Respondent(s)

The Commissioners for His Majesty's Revenue and Customs

Issue

(1) Was the Court of Appeal wrong to conclude that a share transfer was a “scheme transaction” for the purposes of s75A(5) Finance Act 2003? (2) Was the Court of Appeal wrong to conclude that the deemed notional transaction under s75A Finance Act 2003 did not attract group relief?

Facts

This appeal concerns the amount of stamp duty land (“SDLT”) payable on the transfer of a 999 year lease over a residential property development known as the Tower at St George Wharf in Vauxhall. The Tower was owned by a company called St George (South London) Limited (“SGSL”). SGSL held the Tower on trust for another company, St George plc. Both companies were part of the Berkeley group. In order to ring-fence risks associated with owning the Tower, a decision was taken to create a Special Purpose Vehicle (“SPV”) to own the Tower. The SPV created for this purpose (The Tower One St George Wharf Limited) is the appellant in this appeal. Having received advice from PwC, the Berkeley group decided to transfer the ownership of the Tower through a series of transactions rather than through a direct transfer of the lease from SGSL to the appellant. The reason for this was that PwC had advised that the series of transactions would deliver corporation tax advantages. That advice was later accepted to have been wrong, and the corporation tax avoidance scheme therefore failed. The transactions to convey the Tower were effected on 5 July 2011. On that date, SGSL granted a 999 year lease of the Tower to B64 (another company within the Berkeley group), at a premium of £30,198,814 (the book cost of the Tower). The appellant then acquired the entire issued share capital of B64 for £170,000,001. The lease was then transferred by B64 to the appellant at its carrying value (£30,248,814). The SDLT returns filed for the grant of the lease and the transfer of the lease both claimed an exemption from tax under the group relief provisions in Schedule 7 to the Finance Act 2003. HMRC denied the appellant’s group relief claim on the transfer of the lease to it, on the basis that the transaction formed part of arrangements of which the main purpose (or one of the main purposes) was the avoidance of liability to corporation tax, such that group relief was precluded by paragraph 2(4A) of Schedule 7. HMRC assessed the appellant to SDLT of £8m, being 4% of the market value of the lease (roughly £200m). The appellant appealed to the First-tier Tribunal (Tax Chamber) (“F-TT”). The appellant argued that group relief applied to the transfer of the lease, so that no SDLT was payable. Its fallback argument was that the SLDT charge should be limited to the actual consideration paid for the transfer rather than the market value of the lease. The F-TT held that group relief did not apply, and that SDLT was to be calculated on the basis of the market value of the lease (applying section 53 Finance Act 2003). The appellant appealed to the Upper Tribunal, and argued that the F-TT was wrong to conclude that group relief was not available. The appellant also argued that at any rate section 53 Finance Act 2003 was excluded by the section 54(4) exception, which applied and meant that SDLT should be calculated on the basis of the actual consideration provided for the transfer of the lease (rather than the market value of the lease). The Upper Tribunal dismissed the appellant’s appeal on both grounds. The appellant appealed to the Court of Appeal. Its two grounds of appeal both related to section 54(4) Finance Act 2003, which the appellant argued applied with the effect that the consideration to be used for the SDLT calculation should be based on the actual consideration, not the market value. HMRC filed a respondent’s notice in the Court of Appeal, by which they argued that even if the appellant was correct and section 54(4) applied, then at any rate the anti-avoidance provision in section 75A Finance Act 2003 was also engaged, and the result of that was that HMRC’s SDLT calculation should be upheld. The Court of Appeal allowed the appellant’s appeal and found that section 54(4) did apply. However, they also accepted the argument set out in HMRC’s respondent’s notice, and found that section 75A applied. The Court of Appeal therefore upheld HMRC’s assessment of SDLT. The appellant now appeals to the Supreme Court. The appellant’s grounds of appeal both relate to the Court of Appeal’s judgment on section 75A.

Date of issue

11 February 2026

Case origin

PTA

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