Neither the taxpayer nor any relevant associate connected with the taxpayer has a relevant interest in the building or land at the time when the option is revoked, and
if the taxpayer or a relevant associate of the taxpayer has disposed of such an interest, no supply for the purpose of the charge to VAT in respect of the disposal –
is yet to take place, or
would be yet to take place if one or more conditions (such as the happening of an event or the doing of an act) were to be met.
Condition Two – The Twenty Year Condition
The taxpayer or a relevant associate connected with the taxpayer held a relevant interest in the building or land:
after the time from which the option had effect, and
more than 20 years before the option is revoked.
Condition Three – The Capital Item Condition
Any land or building that is subject to the option at the time when it is revoked does not fall, in relation to the taxpayer or a
relevant associate connected with the taxpayer,
for input tax adjustment as a capital item under part 15 of the Value Added Tax Regulations 1995 (adjustments to the deduction of input tax on capital items).
Condition Four – The Valuation Condition
Neither the taxpayer nor any relevant associate connected to the taxpayer has made a supply of a relevant interest in the building or land subject to the option in the 10 years immediately before revocation of the option that:
Was for a consideration that was less than the open market value of that supply, or
Arose from a relevant grant.
Condition Five – The Pre-Payment Condition
No part of a supply of goods or services made for consideration to the taxpayer or a relevant associate connected with the taxpayer before the option is revoked will be attributable to a supply or other use of the land or buildings by the taxpayer more than 12 months after the option is revoked.
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