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Prescribed matter leading to disallowance of relief

Stamp Duties (Relief from Stamp Duties Upon Conversion of Firm to Limited Liability Partnership) Rules 2013

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Wrong or mistyped textWrong structure or numberingWrong title or detailsDuplicated content

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—(1) For the purpose of section 15(3) of the Act, a claim for relief from ad valorem stamp duty in respect of the conversion of a firm to a limited liability partnership referred to in section 15(1) of the Act shall be deemed to have been disallowed if the total amount of the partnership interest of one or more of the original partners disposed of in the period of 2 years from (and including) the date of the conversion is more than 25% of the total amount of the partnership interest of all the original partners on the date of the conversion.(2) Paragraph (1) applies also to the disposal of the partnership interest of an original partner or any part thereof to another original partner, but does not apply to the disposal of the partnership interest of an original partner or any part thereof to —(a)a company or limited liability partnership wholly associated with the original partner; or(b)the trustee-manager of a registered business trust wholly associated with the original partner, to be held as trust property of that trust.(3) For the purposes of paragraph (2)(a) and (b), a company, limited liability partnership or registered business trust is wholly associated with an original partner if —(a)the original partner beneficially owns all the equity interests of the company, limited liability partnership or registered business trust; or(b)a person beneficially owns all the equity interests of the original partner, and also all the equity interests of the company, limited liability partnership or registered business trust.(4) For the purposes of paragraph (3), if —(a)a person beneficially owns (including by virtue of one or more applications of this paragraph) all the equity interests of another person (referred to in this paragraph as a first level entity); and(b)the first level entity beneficially owns all the equity interests of yet another person or a registered business trust (referred to in this paragraph as a second level entity),then the first-mentioned person is taken to beneficially own all the equity interests of the second level entity.(5) In this rule —“equity interests” —(a)in relation to a company, means its shares;(b)in relation to a limited liability partnership, means its capital; and(c)in relation to a registered business trust, means units in the trust;“partnership interest” means a partner’s interest in the capital of the limited liability partnership.

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