Solidity Real Estate — UK Compliance Skill

HMLR — Land Registry Integration

// HM Land Registry: each registered title has a unique Title Number
// Register comprises: Property Register, Proprietorship Register, Charges Register

struct HMLRTitle {
    bytes32 titleNumber;            // UK Land Registry title number (e.g. "TGL12345")
    bytes2 ukJurisdiction;          // "EN" England, "WL" Wales, "SC" Scotland, "NI" N.Ireland
    address registeredProprietor;   // Current legal owner
    bytes32 titlePlanCID;           // IPFS CID of title plan (map)
    bytes32 officialCopyCID;        // IPFS CID of official copy of register
    TitleClass titleClass;
    bool hasRestriction;            // Restriction preventing disposal without consent
    bytes32 restrictionDetails;
    bool hasCharge;                 // Registered charge (mortgage)
    Charge[] charges;               // Charges register entries
    uint256 lastUpdated;
}

enum TitleClass {
    ABSOLUTE,           // Best class — guaranteed title
    GOOD_LEASEHOLD,     // Leasehold where freehold not investigated
    QUALIFIED,          // Minor defect in title
    POSSESSORY          // Based on adverse possession
}

struct Charge {
    address chargee;               // Lender
    bytes32 chargeDate;
    uint256 amountSecuredGBP;
    bool isSatisfied;
    bytes32 chargeDocCID;          // IPFS CID of charge document (Form CH1)
}

// Only HMLR-authorized conveyancers can update title on-chain
modifier onlyConveyancer() {
    require(conveyancerRegistry.isAuthorized(msg.sender), "HMLR: not authorized conveyancer");
    _;
}

UK REIT Structure (CTA 2010)

// UK REIT: tax-exempt if meets conditions
// Key tests: property rental business income ≥75%, property assets ≥75%, distribute ≥90%

contract UKREITToken is ERC20 {
    // UK REIT: minimum 3 shareholders; no single shareholder >10% of ordinary shares
    uint256 public constant MAX_SINGLE_SHAREHOLDER_PCT = 1000; // 10% in basis points
    uint256 public constant MIN_SHAREHOLDER_COUNT = 3;
    uint256 public constant DISTRIBUTION_REQUIREMENT_BPS = 9000; // 90%
    uint256 public constant PROPERTY_INCOME_TEST_BPS = 7500;     // 75%
    uint256 public constant PROPERTY_ASSETS_TEST_BPS = 7500;     // 75%

    uint256 public totalShareholderCount;
    uint256 public totalDistributedThisPeriod;
    uint256 public totalPropertyIncome;
    uint256 public totalIncome;

    // UK REIT: distributions treated as UK property income for tax (not dividends)
    // Must withhold 20% basic rate tax for non-exempt shareholders
    mapping(address => bool) public isTaxExempt;     // Pension funds, ISAs, etc.
    uint256 constant UK_BASIC_RATE_TAX_BPS = 2000;   // 20%

    function distributePropertyIncome(uint256 grossAmount)
        external onlyRole(MANAGER_ROLE) {
        require(
            totalDistributedThisPeriod + grossAmount >=
            totalPropertyIncome * DISTRIBUTION_REQUIREMENT_BPS / 10_000,
            "UKRFIT: 90% distribution test not met"
        );

        uint256 taxAmount = grossAmount * UK_BASIC_RATE_TAX_BPS / 10_000;

        for (uint i = 0; i < shareholders.length; i++) {
            address sh = shareholders[i];
            uint256 shGross = grossAmount * balanceOf(sh) / totalSupply();
            uint256 shNet = isTaxExempt[sh]
                ? shGross
                : shGross * (10_000 - UK_BASIC_RATE_TAX_BPS) / 10_000;
            // ... transfer net amount, withhold tax amount
        }

        totalDistributedThisPeriod += grossAmount;
    }

    // UK REIT: close company rule — cannot be "close company" (broadly: <5 independent shareholders holding >50%)
    function checkCloseCompanyStatus() public view returns (bool isClose) {
        // Check if 5 or fewer participators control >50%
        // ... implementation
    }
}

FCA MCOB — Mortgage Conduct of Business

// MCOB: FCA rules for mortgage lenders and intermediaries
// Responsible lending: affordability assessment mandatory
// ESIS: European Standardised Information Sheet (retained post-Brexit with minor changes)

struct UKMortgage {
    address borrower;
    address lender;                 // Must be FCA-authorized
    uint256 principalGBP;
    uint256 aprcBPS;                // Annual Percentage Rate of Charge (basis points)
    uint256 termMonths;
    uint256 monthlyPaymentGBP;
    bytes32 esisIPFSCID;
    uint256 esiIssuedDate;
    uint256 mortgageOfferDate;
    uint256 offerValidUntil;        // Typically 6 months
    bool isFirstCharge;
    bool isResidential;             // Regulated by MCOB if residential
    bool isHelptoBuy;               // Help to Buy equity loan component
    UKMortgageStatus status;
    HMLRTitle securedTitle;
}

enum UKMortgageStatus { OFFERED, ACCEPTED, COMPLETED, IN_ARREARS, DEFAULTED, REPAID }

// MCOB 11: Responsible lending — affordability must be assessed
// Cannot be assessed purely algorithmically — must involve human oversight
// On-chain: store affordability assessment reference
bytes32 public affordabilityAssessmentRef; // Reference to off-chain assessment record

// MCOB 13: Arrears — lender must treat borrowers fairly before repossession
// Minimum 3 months arrears before possession proceedings
uint256 constant MIN_ARREARS_MONTHS_BEFORE_POSSESSION = 3;

function initiateDefaultProcess(uint256 mortgageId) external {
    UKMortgage storage m = mortgages[mortgageId];
    require(m.status == UKMortgageStatus.IN_ARREARS, "MCOB: not in arrears");
    require(
        missedPayments[mortgageId] >= MIN_ARREARS_MONTHS_BEFORE_POSSESSION,
        "MCOB: minimum arrears period not met"
    );
    // Off-chain: must also have made contact attempts, considered alternatives to repossession
    m.status = UKMortgageStatus.DEFAULTED;
    emit DefaultInitiated(mortgageId, block.timestamp);
}

SDLT — Stamp Duty Land Tax Tracking

// SDLT: England + NI | LBTT: Scotland | LTT: Wales
// Rates vary: residential, non-residential, first-time buyer relief, additional dwelling surcharge

enum SDLTJurisdiction { ENGLAND_NI, SCOTLAND, WALES }

struct SDLTRecord {
    uint256 propertyValueGBP;
    SDLTJurisdiction jurisdiction;
    bool isResidential;
    bool isBuyerFirstTimeBuyer;     // First-time buyer relief (up to £425k SDLT-free in England)
    bool isAdditionalDwelling;      // 3% surcharge for additional residential properties
    bool isCorporateBuyer;          // 15% flat rate for residential >£500k by company
    bool isForeignBuyer;            // +2% surcharge (from April 2021)
    uint256 sdltLiabilityGBP;      // Calculated liability
    bytes32 sdltReturnRef;          // HMRC SDLT return reference number
    bool sdltPaid;
}

// England residential SDLT rates 2024/25:
// £0-£250k: 0% | £250k-£925k: 5% | £925k-£1.5M: 10% | >£1.5M: 12%
// First-time buyer: 0% on first £425k, 5% on £425k-£625k (no relief if >£625k)
// Additional dwelling: +3% on all bands

function calculateSDLT(
    uint256 valueGBP,
    bool isFirstTimeBuyer,
    bool isAdditional,
    bool isForeign
) public pure returns (uint256 sdlt) {
    if (isAdditional) {
        // Additional dwelling: standard rates + 3% surcharge on all bands
        if (valueGBP <= 250_000e18) sdlt = valueGBP * 3 / 100;
        else if (valueGBP <= 925_000e18) sdlt = 250_000e18 * 3/100 + (valueGBP - 250_000e18) * 8/100;
        else if (valueGBP <= 1_500_000e18) sdlt = 250_000e18*3/100 + 675_000e18*8/100 + (valueGBP-925_000e18)*13/100;
        else sdlt = 250_000e18*3/100 + 675_000e18*8/100 + 575_000e18*13/100 + (valueGBP-1_500_000e18)*15/100;
    } else if (isFirstTimeBuyer && valueGBP <= 625_000e18) {
        if (valueGBP <= 425_000e18) sdlt = 0;
        else sdlt = (valueGBP - 425_000e18) * 5 / 100;
    } else {
        if (valueGBP <= 250_000e18) sdlt = 0;
        else if (valueGBP <= 925_000e18) sdlt = (valueGBP - 250_000e18) * 5 / 100;
        else if (valueGBP <= 1_500_000e18) sdlt = 675_000e18*5/100 + (valueGBP-925_000e18)*10/100;
        else sdlt = 675_000e18*5/100 + 575_000e18*10/100 + (valueGBP-1_500_000e18)*12/100;
    }
    if (isForeign) sdlt += valueGBP * 2 / 100; // +2% surcharge
}

UK Leasehold Reform

// Leasehold Reform (Ground Rent) Act 2022: ground rent = peppercorn (£0) for new leases
// Leasehold and Freehold Reform Act 2024: extended right to extend lease, buy freehold

struct UKLease {
    bytes32 titleNumber;
    address leaseholder;
    address freeholder;
    uint256 leaseStartDate;
    uint256 leaseTermYears;
    uint256 groundRentGBP;          // Must be 0 for leases granted after 30 June 2022
    uint256 serviceChargeEstimateGBP; // Annual estimate
    bool hasRightToManage;          // Leaseholders' RTM rights (≥50% participation)
    bool hasEnfranchisementRight;   // Right to buy freehold
    uint256 yearsRemaining;
}

// Leasehold Reform Act 2022: peppercorn rent enforcement
modifier validGroundRent(uint256 leaseStartDate, uint256 groundRentGBP) {
    if (leaseStartDate >= 1656547200) { // 30 June 2022 Unix timestamp
        require(groundRentGBP == 0, "LRA2022: ground rent must be zero (peppercorn) for new leases");
    }
    _;
}

Security & Compliance Checklist

• Title Number stored and HMLR official copy CID referenced
• Charges register updated on-chain when mortgage registered at HMLR
• UK REIT: close company check, 90% distribution, 75% income/asset tests
• MCOB: FCA-authorized lender verified; affordability assessment reference stored
• SDLT calculated correctly including surcharges (additional dwelling, foreign buyer)
• Scotland (LBTT) and Wales (LTT) handled separately from England SDLT
• Leasehold: zero ground rent enforced for leases post-30 June 2022
• AML: estate agents / conveyancers KYC'd under MLR17; UBO identified
• Building Safety Act: accountable person recorded for high-rise buildings
• OFSI sanctions checked separately from EU sanctions post-Brexit

Reference Files

• references/hmlr-digital-integration.md — HMLR blockchain initiatives, digital mortgage deed
• references/uk-reit-tests.md — Full UK REIT qualification tests and calculations
• references/sdlt-lbtt-ltt.md — Full rate tables for all three UK land taxes