There is a lot to Star Wars. There are a few films that everyone knows of (of which 2 are excellent, 2 ok and 5 awful) but also a much wider universe. The lore of the Star Wars universe (canon and non-canon – thanks to Disney) is vast. I was asked to write this blog for “Star Wars day” as I’m a fan, particularly of the non-film lore. The challenge is to write about something that is even remotely work related – particularly as it is Friday afternoon…
There are a few areas that can be tax related, straw clutching at its best here, such as the Empire’s R&D claims for the Death Star(s), capital allowance claims and probably some more that could be listed if I really thought about it.
On a tangent slightly, I do wonder what the insurance premiums and death in service claims are like… I imagine the Empire (and First Order) must have very busy lawyers dealing with all the claims by family members after their loved ones have been killed in the performance of their duties or just murdered by their Sith boss.
Despite all that, I’m settling for considering the Rebel Alliance’s (and latterly the Resistance) use of property. The Rebel Alliance have lots of property around the galaxy and they have had to move on several occasions. There was a main residence on Dantooine which they left to go to Yavin 4 and they subsequently moved to Hoth. They left Hoth in a bit of a hurry…
It has to be assumed that they have a very good estate agent to keep finding these out of the way places.
So, did the Rebels already own the properties? For the Rebels to move so quickly they must have known where they were going to and have a backup property. It makes sense that Yavin 4 and Hoth were owned already but just not on the Land Registry in Leia Organa’s name – otherwise even a Stormtrooper of Finn’s capability would have been able to track them down easily if they were.
The stamp duty land tax bill must have been horrendous for each purchase. If we assume that their main residence was on Dantooine, and they purchased additional dwellings, the higher rate for additional dwellings (the 3% surcharge) may have been due. There were no intentions to move to Yavin 4 or Hoth at the time of purchase so possibly no ability to reclaim the surcharge after disposing of Dantooine.
Of course, this assumes Dantooine was disposed of and not just kept as a decoy. And if it was sold, how is the capital gains tax calculated? Is private residence relief available? Or would the fact that they have been running a business (running a rebellion isn’t cheap so they may have had an income stream from selling branded clothing across the galaxy) from their home mean private residence relief can’t be claimed?
What if everything is acquired by a company, rather than an individual? Does the 15% rate of tax apply? What about ATED?!
But, there must be an element of non-residential use at the properties. After all, you don’t keep several squadrons of X-Wings, A-Wings and Y-Wings in your back garden all for personal use. This leads me to think that the properties must be mixed-use. If they are mixed-use the surcharge won’t apply.
Depending on the price of property on Yavin 4 and Hoth, the tax will still be quite large. Let’s hope Princess Leia Organa (later General Organa) obtained some good stamp duty tax advice at the point of purchase.
I am assuming that they paid tax of course. Maybe they are so rebellious that they decided not to pay any tax. For a start, I doubt they file annual tax returns to the Empire. Maybe that’s why the Empire are chasing them across the galaxy far, far away? They may just be cracking down on tax evasion, using an extremely heavy hand.
If you want to pay the right amount of tax on a property purchase or sale, without any nefarious schemes being used, please feel free to contact the Tax Team at Gepp Solicitors on 01245 228125 or PrivateClientEnq@gepp.co.uk. Luckily we are based in Chelmsford, not Hoth, so you won’t need to bring your tauntaun.
One final thought. Every true fan knows, Han shot first.