In Stuart Fox v HMRC [2022] UKUT00310, the Upper Tribunal (UT) found that a Stamp Duty tax avoidance scheme involving the transfer of a property from a wife to her husband failed because they were connected, as such he was liable for the entire tax liability.

  • The taxpayers purchased a £1m residential property undertaking a Stamp Duty Land (SDLT) Tax Avoidance Scheme whereby:
    • Instead of purchasing the property jointly as initially intended, Mrs Fox agreed to purchase the property for £1m.
    • Mrs Fox then agreed to sell the property concurrently to Mr Fox for £10,000 such that the vendors transferred the property directly to Mr Fox.
    • The SDLT return for the transaction was completed on the basis that the consideration was £10,000 excluding the £1m paid for the property by Mrs Fox. 
  • HMRC enquired and found SDLT should be charged on the consideration of £1m.
  • The taxpayer conceded that the scheme did not work as the two individuals involved in the transaction (husband and wife) were connected.  This meant the consideration for both transactions needed to be amalgamated.
  • However, the taxpayer claimed that he was only liable for half the SDLT liability as he held the property in trust for himself and his wife following his acquisition.
  • Following an unsuccessful appeal to the FTT, Mr Fox appealed to the UT.

The UT found:

  • The FTT had not erred in law in finding that Mr Fox was the sole owner of the property following the transaction after weighing up the evidence.
  • The scheme was designed to rely on sole ownership of the property passing from Mrs Fox to Mr Fox in order to reduce the consideration chargeable to SDLT.
  • Bank accounts were specifically set up in sole names to implement the scheme which showed an intention that consideration was paid between the parties.
  • That the couple's finances had been conducted jointly before did not mean that the steps taken to segregate funds to sole ownership were invalid.
  • As the funds used for the scheme were in the sole ownership of the respective individuals, there was consideration for the second contract and it was valid as a result.

The appeal was dismissed.


While the tax avoidance scheme was never going to work as the individuals concerned were connected, its otherwise correct implementation did lead to the ownership of the underlying asset being other than intended.  

Useful guides on this topic

Tax avoidance schemes
How do you spot tax avoidance schemes? What are the types of schemes available that should be avoided? What disclosure requirements are there? When are tax clearances needed?

SDLT: At a glance, Stamp Duty Land Tax, rates & allowances
What is Stamp Duty Land Tax (SDLT)? What are the rates of Stamp Duty Land Tax (SDLT)?

Stamp Duty Land Tax, start here
What is SDLT? What are the SDLT rates? What is exempt from SDLT? What reliefs are available? When are returns due? When can you amend a return?

External links

Stuart Fox v HMRC [2022] UKUT00310

Squirrel ad

Are you enjoying our content? 

Thousands of accountants and advisers and their clients use as their primary TAX resource.

Register now to receive our FREE weekly SME Tax News update