SPV meaning

In this issue: Public procurement Governance Social housing Education Children's social care Social care Planning Daily and weekly news alerts New and updated content Public procurement Cabinet Office publishes first suite of Procurement Act 2023 guidance documents The Cabinet Office has issued an initial tranche of guidance on the Procurement Act 2023 (PA 2023). Designed to offer technical support, the materials explain interpretation and application of PA 2023, and are directed at procurement practitioners and commercial policy leads within contracting authorities. Each document should be read alongside PA 2023 and the related regulations. The Cabinet Office confirms a staggered release, aiming to complete the full set by June 2024. The Procurement Regulations 2024 have likewise been released in final form for Parliamentary debate. These draft regulations include the amendments flagged in the government’s consultation response issued on 22 March 2024. Separate guidance for devolved Welsh authorities will be issued by the Welsh Government in...

The Tower One St George Wharf Ltd v HMRC [2022] UKFTT 154 (TC) A corporate group was progressing a site for residential use as a development project. The concluding phase involved a 50‑storey tower, which they planned to place into a special purpose vehicle (SPV) to ring‑fence exposure to risk and potential liabilities, and to secure greater financial flexibility for the project as a whole. After consulting their tax advisers, the group executed a sequence of transactions on the very same day intended to step up the tax cost of the scheme, so the SPV would be treated as acquiring it at market value, with no tax liabilities arising along the chain overall. In outline, the company that owned the property granted a 999‑year lease to another group entity, B64. The shares in B64 were then purchased by...

The Tower One St George Wharf Ltd v HMRC [2025] EWCA Civ 1588 A corporate group developed a residential scheme, with the concluding phase being the transfer of a 50‑storey tower block to a special purpose vehicle (SPV) to ring‑fence risks, contain potential liabilities and improve financial flexibility. After consulting tax advisers, the group executed a set of same‑day steps intended to ‘step up’ the tax cost of the project, so the SPV would be treated as acquiring it at market value without tax charges arising en route. In broad terms, the property‑owning company granted a 999‑year lease to another group entity, B64. The appellant, incorporated to serve as the SPV, then acquired the shares in B64, and the lease was subsequently transferred to it by way of distribution. After an HMRC enquiry, the appellant accepted the planning had not produced the anticipated tax advantage. HMRC then assessed the appellant to SDLT on the lease’s market value at the residential rate. The company appealed on the basis that it...

Types of special purpose vehicle and orphan trust The deployment of special purpose vehicle structures is widespread in aviation finance. They offer lenders several advantages, including tax benefits and a bankruptcy-remote platform for the financing. A special purpose vehicle (SPV), also known as a single purpose company (SPC), is a legal entity established for a limited aim; in aviation finance this is commonly to own an aircraft for a particular transaction. There are numerous forms of SPV used in aviation finance, with the principal categories being: subsidiary companies orphan trusts limited partnerships Each of these is considered below. The type of SPV selected will vary on a transaction-by-transaction basis. Subsidiary companies Subsidiary companies are typically limited liability companies incorporated in a tax-friendly jurisdiction...

Key differences in the legal risk profile, compared to a direct property purchase In general, a person acquiring the shares in an SPV that owns UK property seeks to emulate the commercial position that would exist on a direct purchase of that property. Typically, property-related points are handled through replies to enquiries and the buyer’s own investigations, with any other issues dealt with separately via due diligence and the corporate documentation. Nevertheless, the risk profile of an SPV transaction is, unavoidably, quite different from that of buying the property directly. Two principal reasons explain this: on a direct purchase, the buyer can rely directly on property searches and the process of land registration to secure good title to the property, free of encumbrances. In an SPV share acquisition, those searches provide only indirect protection the purchaser of SPV shares will inherit, albeit indirectly, any actual or contingent liabilities and issues relating to the corporate entity itself. To assess those liabilities, the buyer must rely on...

Tax is a key consideration when selecting an appropriate structure for holding UK commercial property. The prevailing route for investing in UK commercial property is typically a UK‑incorporated, tax‑resident limited company. Non‑UK investors have also gravitated towards offshore ownership for investment, commonly via a non‑UK resident special purpose vehicle (SPV). Following reforms to the taxation of gains realised by non‑UK residents on UK immovable property from 6 April 2019, and to the taxation of property income of non‑UK resident companies from 6 April 2020, non‑UK resident companies that hold UK commercial assets now fall within UK corporation tax on gains (subject to certain exemptions) and on rental income. As a consequence, a number of the core tax attractions of using non‑UK resident SPVs to own UK commercial property have been curtailed. Nevertheless, acquiring UK commercial property through an offshore SPV remains a widely used and popular structure for many investors. It can still continue to provide a saving in stamp duty land tax when compared with purchasing the underlying...