My company owns a block of four flats in London, freehold under a single title. A title split will create four leasehold flats, and I understand the law states that a leaseholder and freeholder cannot be the same. If I create a new company to hold the leases, how can the leases be transferred to the new company without tax and stamp duty land tax (SDLT) implications, and how can the new company be funded? Or, can you please suggest a better way to handle the title split without incurring SDLT and tax charges? 

Arthur Weller replies:  

Instead of creating a new company to hold the leases, you could create a new company to hold the freeholds. If you do this, you can minimise the tax involved via a sale and leaseback.  

With regard to capital gains tax, see HMRC’s Capital Gains manual at CG70774, and in relation to SDLT, see HMRC’s Stamp Duty Land Tax manual at SDLTM16040.