3 Calculation of Net Sales Receipt

3.1 General 

3.1.1 This chapter sets out the basis for calculation of the Net Sales Receipt from the disposal of the property. The next chapter describes how to calculate the amount of Grant that is Recoverable.  If the Net Receipt is greater than the Recoverable Grant, then the RSL will either Repay or Recycle the full amount of Recoverable Grant.

3.1.2 The RSL must calculate whether the net Net Sales Receipt is sufficient to cover the Grant liability.  To do this, the Agency sets out the various Eligible Deductions that can be made from the gross sales receipt, to get to the Net Sales Receipt receipt.

3.1.3 If the Net Sales Receipt is less than the Recoverable Grant, then the RSL may have to defer payment, or the shortfall may be written off by the Agency.

3.1.4 The Relevant Events detailed in (a) to (f) of (7) of the Recovery Determination cover Grant paid in error or in excess of requirements. It also covers circumstances where an RSL does not act in accordance with the Recovery Determination or Funding Conditions or this Guide (as the Funding Conditions require compliance with this Guide). Following these Relevant Events the Agency will require the Recovery of Grant or excess Grant (calculated by comparison of the amount advanced with the amount needed) in full, without deductions or allowances for the RSL’s costs.

3.1.5 The Relevant Events detailed in (g) to (q) of (7) of the Recovery Determination cover disposals, change and cessation of use and other circumstance.  Following these Relevant Events the Agency will make certain defined allowances:

• for costs, fees and expenses incurred by the RSL in direct relation to the Relevant Event.
• for the deferral or reduction of Grant Recovered where Net Sales Receipts are less than the amount of Grant that is, in theory, Recoverable.
• for other circumstances considered relevant.  These are described below.

3.1.6 The following forms must be used by the RSL when calculating the Net Sales Receipt and the amount of Grant Recoverable. They are intended to help in making the correct calculation and documentation following a Relevant Event.

• RCG1 for outright sales
• RCG2 for staircasing sales
• RCG3 for recovery of tenants’ discounts

When Supporting Documentation is required, it should be kept with the form.

3.2 Deemed Loan Debt

3.2.1 For rented schemes RSLs must apportion Deemed Loan Debt in the same way as they apportion Grant.  See 4.1.

3.2.2 For shared ownership schemes approved on or after 1 April 1993, Deemed Loan Debt is apportioned according to the market values of the Dwellings at practical completion of the scheme. 

3.2.3 For shared ownership schemes approved before that date, the Deemed Loan Debt calculations take into account the percentage of equity initially sold - see Deemed Loan Debt in the Glossary

 
3.3 Outright Sale of Land and Buildings

3.3.1 The Gross Sale Receipt  received by the RSL must not be below a Valid Valuation  by an Independent Qualified Valuer . 

What is an “outright sale”? Click on the asterisk.  

 

3.3.2 The Net Sale Receipt  is the Gross Sale Receipt less the Eligible Deductions, which are:

1. the Deemed Loan Debt, the
2. reasonable valuation fees and expenses and
3. reasonable legal fees and expenses of the disposal. 

An RSL may not deduct any administration allowance. 

3.3.3 An RSL may not deduct the cost of demolition (if any) from Gross Sales Receipts if it sells the site. 

If the Net Sale Receipt is less than the attributable Capital Grant, the shortfall will be written off.

3.3.4 Where Capital Grant is to be written off, Supporting Documentation should be attached to the Recovery of Capital Grant form to confirm the figures used in the calculation. Follow asterisk for further guidance.  

 

3.3.5 Where the consideration for the disposal is the provision of replacement Property on a different site, Capital Grant will not be Recovered.  Instead the RSL must transfer the Capital Grant liability to the replacement Property by means of a credit and debit to the Recycled Capital Grant Fund, using suitable documentary evidence in place of the Recovery of Capital Grant form. 

3.3.6  Because the property exchange is for the benefit of the purchaser, the RSL would not expect to pay its own legal and valuation fees, so these expenses must NOT be deducted from the Recoverable Capital Grant.

3.4 Sale under compulsory purchase orders

3.4.1 If a Property owned by an RSL is sold under a Compulsory Purchase Order (CPO) (or where there is written evidence of the threat of a CPO), the amount of Capital Grant Recovered will be calculated in the normal way, EXCEPT :

1 the Gross Sales Receipts will be the HIGHER of either:
a. the receipt from the disposal PLUS any compensation received PLUS any interest received as part of the CPO, or
b. the amount obtained by a qualified valuer acting on behalf of the RSL in negotiation with the body exercising compulsory powers

2 Eligible deductions will only include the RSLs valuation and legal fees & costs, and an administrative allowance if the body exercising the CPO has not paid them as part of the CPO process 

3.4.2 The amount of interest to be included in the calculation of the gross sales received will be the interest paid by the acquiring body, less any tax on that interest that the RSL may have to pay (if it is non-charitable), plus any Tax Relief Grant that it may have received to offset the tax paid

3.4.3 Disposal of ‘spare’ land in these circumstances is covered in {paragraph 3.15.5}

3.4.4 The amount of Capital Grant Recovered will not normally be reduced in respect of any costs incurred by an RSL in opposing a CPO.  For some Guidance issues arising from CPOs, follow the asterisk.  

 

3.4.5 Where a reduction is sought, the RSL must obtain the prior consent of the Agency, which will only be given in very exceptional situations.  This prior consent is necessary even though the Recoverable Capital Grant is to be Recycled by the RSL.

3.4.6 If the net sales receipts resulting from this calculation are insufficient to enable the Recovery of all the Capital Grant attributable to that Property or land, the amount of Capital Grant Recovered may, at the Agency’s discretion, be reduced by the shortfall. RSLs should discuss such cases with the Regional Investment Team. However, if the RSL makes net surpluses upon the sale of other Property or land within the same Compulsory Purchase Order, those surpluses must be used to cover the shortfall in whole or in part. 

3.4.7 If a shortfall still remains, the amount of Capital Grant Recovered will be reduced by the shortfall.  Where Capital Grant is to be written off, the Recovery of Capital Grant form must have Supporting Documentation to confirm the figures used in the calculation. 

3.5 Shared Ownership Sales

For shared ownership schemes approved on or after 1 April 1993, Deemed Loan Debt is apportioned according to the market values of the Dwellings at practical completion of the scheme. 

Shared Ownership: Voluntary sale of rented property

3.5.1 RSLs should note that this section covers voluntary sales on property on a shared ownership basis with no discount.  This is different from Social HomeBuy (SHB), which is the voluntary sale of property on a shared ownership basis with a discount funded by the Agency.  Refer to SHB

3.5.2 The Gross Sale Receipts must not be below a Valid Valuation  by an Independent Qualified Valuer . 

3.5.3  The eligible deductions from the Gross Sale Receipts are
1. the Deemed Loan Debt, and the
2. valuation expenses and
3. legal expenses of the disposal,

but no administrative allowance. 

3.5.4  If the Net Sale Receipts is insufficient to enable the Recovery of all the attributable Capital Grant, then Recovery of the shortfall will be deferred to the next staircasing sale.  Where there is a deferment of Capital Grant, the Recovery of Capital Grant form should have Supporting Documentation to confirm the figures used in the calculation.

3.5.5 When the sale into shared ownership is of a Property included in an Estates Renewal Challenge Fund Programme, Capital Grant will be Recovered as in the paragraph immediately above except when sales into shared ownership WITHOUT Recovery was agreed as part of the delivery plan.

3.6 Shared Ownership: Sale of a Repurchased Property

3.6.1 The RCGF should be credited with the value of Grant (including RCGF) used in the repurchase net of eligible deductions. 

3.6.2 The eligible deductions from the Gross Sale Receipts are the valuation and legal expenses of the disposal.

3.6.3 If the Net Sale Receipts are insufficient to enable the Recovery of all the attributable Capital Grant, then Recovery of the shortfall will be deferred to the next staircasing sale. 

3.6.4  Where there is a deferment of Capital Grant, the Recovery of Capital Grant form should have Supporting Documentation to confirm the figures used in the calculation.

3.7 Shared ownership: staircasing sales

3.7.1   The Gross Sale Receipts must not be below the applicable proportion of a Valid Valuation by an Independent Qualified Valuer. 

3.7.2  The eligible deductions from the Gross Sale Receipts are the Deemed Loan Debt attributable to the percentage sold, and the Staircasing Allowance.  The valuation must be paid for by the prospective purchaser. 

3.7.3 These Net Sale Receipts are used to Recover the Capital Grant attributable to the staircased proportion of the Dwelling plus any Capital Grant previously deferred on initial or subsequent staircasing sales within the same scheme. 

3.7.4 If the Net Sales Receipts are insufficient to enable the Recovery of all the attributable and deferred Capital Grant, then the shortfall of the Capital Grant Recoverable will be deferred until the sale of a further share of that Dwelling or sales of shares of any other shared ownership Dwellings within the same scheme.

3.7.5 If, when the final Dwelling in a scheme is staircased to outright ownership (or the maximum percentage allowable for that scheme) the total Net Sales Receipts were less than the Grant Recoverable,  the final shortfall will be written off.

3.7.6 Where there is a deferral or write off of Capital Grant, the necessary Supporting Documentation must be attached to the Recovery of Capital Grant form.

3.8 Shared Ownership:  Repossessions

3.8.1 For an overview of repossessions, see mortgage default at NBHB section 7

Follow the asterisk for further details.   

 

3.8.2 Policy in respect of defaulting shared owners is contained in Housing Corporation Circular 26/86 which is still valid, and should be consulted. 

3.8.3 The basic approach is the same as for any other Shared Ownership Staircasing (see 3.7), although there are detailed differences:

1. the RSL may accept (for Recovery purposes) the valuation by the mortgagee’s valuer instead of one by an Independent Qualified Valuer
2. The Gross Sale Receipt is the money received from the mortgagee, as stated in the mortgagee’s statement of account  For details

3.8.4  The eligible deductions from the Gross Sale Receipts are

1. the Deemed Loan Debt attributable to the percentage sold, and
2. the Staircasing Allowance. 

3.8.5  Any shortfall on staircasing receipts remains a debt due to the RSL by the defaulting leaseholder.

3.8.6 Where leaseholder’s mortgagee has used the Mortgagee Protection Clause, and the RSL has suffered a shortfall on staircasing receipts Recovery of Capital Grant will be written off or deferred if the RSL confirms in Supporting Documentation to the Recovery of Capital Grant form that they

1. are in the process of obtaining legal advice, or have already obtained legal advice on prospect of recovering the money due from the leaseholder,
2. will take all necessary steps to recover the money due and
   
3. undertake to credit all money received, less reasonable costs incurred, to the Recycled Capital Grant Fund, or pay the money to the Agency if applicable within fourteen days of receipt.
    

3.8.7 In deciding what action is reasonable to pursue the debt the RSL should obtain the written advice of its solicitors.  A copy of the solicitor’s advice must be kept with the Recovery of Capital Grant form for audit purposes.

3.8.8 If action is taken as advised by the RSL’s solicitor, and no receipts are generated, any expenses or abortive costs will NOT be allowed against Capital Grant Recovery UNLESS the surpluses from shared ownership staircasing sales completed in the previous twelve months are insufficient to cover the costs. 

Where the RSL incurs such a loss, the RSL can deduct the costs that it has incurred from a future Recovery of Capital Grant on a shared ownership sale or staircasing.

3.8.9 If the amount for which the defaulting leaseholder is liable under the Mortgagee Protection Clause would have left the RSL with a surplus after full Recovery of Capital Grant then it is a matter for the RSL to decide whether to seek to Recover this amount when taking action to Recover other monies due.  A worked example is given in Appendix 3 of Housing Corporation Circular 26/86.

3.8.10 Where the Recovery of Capital Grant is to be reduced or deferred, the Supporting Documentation should include an appropriate certification signed by an authorised signatory of the RSL together with a copy of the Completion Statement provided by the leaseholder’s mortgagee, and a copy of the mortgagee’s explanation if the sale price is lower than the Valuer’s valuation, etc.

3.9 Equity Loan redemptions

Equity loans paid by RSLs or HomeBuy Agents prior to 1st April 2008, or under transitional arrangements during the period to 30 September 2008

3.9.1 An owner redeeming all or part of an equity loan, either voluntarily or when obliged to do so upon selling the property, is a Relevant Event (para 7(q) of the Determination).

3.9.2 The Grant Recoverable is the lower of
1. the Capital Grant attributable to the property (including any Grant paid to cover the scheme on costs), or
2. (where property values have fallen) the amount of the equity loan redeemed.

3.9.3 However any administrative costs associated with the redemption are not Eligible Deductions from the Gross Sales Receipt, as there are no costs of sale – as there is no sale, only the redemption of the loan.

Equity loans paid by Equity Loan Providers from 1st April 2008. 

3.9.4 An owner redeeming all or part of an equity loan, either voluntarily or when obliged to do under the terms of their equity loan agreement, is a Relevant Event (para 7(q) of the Determination).

3.9.5 On receipt of the home owner's equity loan repayment the Equity Loan Provider will be required to process that receipt in accordance with the terms agreed with the Agency and the relevant clauses in their Equity Loan Contract.

 

 
3.10 Right To Buy 

3.10.1 The sale price must not be less than the Cost Floor UNLESS the Cost Floor is greater than the Valid Valuation at the time of offer. For an  example follow the asterisk.   

 

3.10.2 Where the cost floor is greater than the valuation of the Dwelling (without discount) the sale price should equal the valuation (for an example click here).

3.11 Right To Buy: Loans

3.11.1 The deductions to be offset against the Gross Sale Receipt shall be:

1. the Deemed Loan Debt,
2. reasonable expenses being the valuation and legal expenses of the disposal,
3. the Right To Buy (RTB) sales allowance,
4. any Abortive RTB sales  expenses

For Guidance on Abortive Sales, follow the asterisk.   

 

3.11.2  Reasonable expenses can also include deficits on RTB service charges in respect of repairs (see Housing Corporation circular 18/88).

3.11.3 Abortive Sales: A copy of the completion notice or a signed statement by the tenant that he or she does not intend to proceed with the sale should be attached to the Recovery of Capital Grant form as supporting evidence.

3.11.4 These Net Sales Receipts shall be used to Recover the Capital Grant attributable to the Dwelling in question.  If the Net Sales Receipt is insufficient to enable the Recovery of all the attributable Capital Grant, then the shortfall will be written off. Why might there be a shortfall?  For Guidance follow the asterisk.  

 

HOWEVER:

3.11.5 If an RSL wishes to use expenses of abortive or deferred sales when calculating the Net Sales Receipt, a schedule or similar evidence must be attached to the Recovery of Capital Grant form demonstrating  that surpluses from RTB sales of Capital Grant funded property in the previous Accounting Period, and the current Accounting Period to date, are insufficient to cover these costs.

3.11.6 Further Grant Recovery may occur if a tenant should dispose of the property within the discount period and have to repay all or part of the discount.

3.11.7 The Recovery of Capital Grant will not be deferred or Capital Grant written off to give discounts to sitting tenants greater than those provided for in Section 129 of the Housing Act 1985or as subsequently amended.

3.12 Repayment of Right to Buy Discount

3.12.1 Where Grant has been paid, or the Recovery of Grant has been reduced to fund a Right to Buy discount, and a subsequent sale takes place which should give rise to a Repayment of the discount, the Grant paid or reduced will be Recovered on an equitable basis. 

3.12.2 In this calculation, the RSL must deduct from the Gross Receipt paid by the owner an allowance (please see DPF 2.2) set by the Agency, to cover the administration of retrieving the discount,

3.13  Voluntary sales to tenants not on Right to Buy terms

3.13.1  When land and Property is disposed of outright to a tenant on terms not identical to Right to Buy provisions, the calculation of Recoverable Capital Grant will be as above, except that no allowances are available.

3.14 New Build Homebuy (pre-April 2006)

3.14.1 For a brief description of the pre-April 2006 NewBuild Homebuy (which is significantly different from current NewBuild HomeBuy). Click on the asterisk.  

 

3.14.2  The Net Sales Receipts for the initial sale are calculated in the usual fashion, as the Gross Sales Receipts less:

1. Deemed Loan Debt
2. valuation fees
3. legal fees and expenses
4. and administrative allowance. 

3.14.3 Grant Recovery is the same as for current NewBuild HomeBuy except that the sale of property is a Relevant Event, and therefore Grant paid towards the cost of developing the scheme can be Recovered at that time if the Net Sales Receipt is positive.

3.14.4 If, at the time of the sale of property, the Net Sales Receipts is negative then Grant Recovery is deferred until the final sale (i.e. when the owner sells on and has to repay their 25% equity loan).

3.14.5 If, on repayment of the equity loan the Net Sales Receipts are insufficient to Recover all of the Grant, the shortfall will be written off by the Housing Corporation.

3.14.6 For some worked examples, follow the asterisk.   
 

3.14.7 Where Recovery of Capital Grant was previously reduced to provide a discount for a tenant, all or part of that reduced Capital Grant shall be Recovered should the former tenant dispose of the Dwelling within three years of the completion of sale by the RSL.

3.15 Disposal of undeveloped land

3.15.1 Selling land that has been acquired with the aid of Capital Grant before the development is completed is a Relevant Event. Capital Grant is therefore Recoverable. 

3.15.2 The Gross Sales Receipt should not be less than the Valid Valuation provided for the RSL by and Independent Qualified Valuer.

3.15.3  Eligible Deductions from the Gross Sale Receipt are:

• reasonable valuation fees and expenses
• reasonable legal fees and expenses
• reasonable marketing costs

3.15.4 The amount of Grant to be Recovered will be calculated on the apportionment basis set out in 4.6

3.15.5 The sale of “spare land” is not a Relevant Event, and Capital Grant will not be Recovered, and the Net Sales Receipt does not need to be ascertained. ‘Spare’ land includes:

• part of a garden or general landscaping;
• plots of land for electricity sub-stations or similar utilities;
• land swaps to regularise boundaries; and
• rights of way, access, or easements.

3.15.6 Spare land excludes any area of land designated at project approval for any future phase or phases. If in doubt about whether land is spare, consult the Agency’s field office.

3.16 Co-ownership equity sharing sales

3.16.1 When a co-ownership (equity sharing) society sells property to one of its members, the society should calculate the Capital Grant attributable to the property pro rata, based on the capital amounts of the purchasing members. 

3.16.2 The Agency does not permit deferral or write off of the Recoverable Grant. In other words, the amount of Grant Recoverable is not reduced if the Sales Receipts are less than the Grant Recoverable.  In this case, therefore, there is no need to specify Eligible Deductions, as they are simply not applicable.
 
3.16.3 Where the case is handled solely by the Co-ownership Society, the Recoverable Grant must be repaid to the Agency.

3.16.4 Where a case is handled through an RSL, that RSL should credit their own RCGF with the Recoverable Grant.

3.17 Change to non-social housing use

3.17.1  A change of use will be a Relevant Event if the Property in the ownership of the RSL changes use to one which does not qualify for SHG (at the time of the change of use). 

3.17.2 Capital Grant will be Recovered as if the Property had been sold outright . 

3.17.3 The RSL will not actually receive any payment from a purchaser, of course, so the calculation has to be based on notional figures. The RSL must obtain a valuation  of the property from an Independent Qualified Valuer on the assumptions of:
1. vacant possession,
2. existing use

to determine the notional “Gross Sales Receipt”.

Eligible deductions at the same as for Open Sale i.e.

1. the Deemed Loan Debt
2. reasonable valuation fees and expenses and
3. reasonable legal fees and expenses of the disposal. 

3.17.4 An RSL may not deduct any administration allowance. 

3.17.5 Capital Grant will not normally be Recoverable where the primary need of an elderly resident changes from housing to nursing care and it is intended that the next Letting will be to someone in housing need.  Where there is any doubt about the future use of the property, the RSL should consult with the Agency’s field office’s Investment Officer in advance.

3.18 Temporary change of use with permission

3.18.1 In exceptional circumstances, the Agency may agree a temporary change of use, without Recovery, to one not qualifying in principle for Social Housing Grant.  This agreement will be made by the relevant regional team. 

3.18.2 The Regional Investment Team will make a judgement on individual applications, taking into account:
• the level of demand for the existing use of the land or Property;

• the likelihood that it could be returned to Social Housing within 12 months;
• factors which make it difficult or undesirable to dispose of the land or property;
• whether the temporary use offers a housing or regeneration function; and
• whether the temporary use falls within the permitted purposes of a Registered Social Landlord.

3.18.3 Such agreement to a temporary change of use will last for 12 months, subject to review (and very exceptionally renewal) thereafter.

3.19 Change from supported housing to general needs use

3.19.1 A change of use from Supported Housing to general needs is a Relevant Event

3.19.2 This is not treated as a "notional sale", and so there are no Gross Sales Receipts (real or notional) or Eligible Deductions.  Instead, the RSL will credit to the RCGF 12% of all Capital Grant paid on the Supported Housing units (net of any Capital Grant previously Recovered)  subject to the exceptions set out immediately below.

3.19.3 If the RSL is providing a replacement Supported Housing service in units that form part of its general needs stock then Grant Recovery may be waived by the Agency, at the discretion of the relevant Regional Investment Team.

3.19.4 The Agency reserves the right to Recover Grant if, in the future, the replacement units ceased to be used for Supported Housing without further replacement units being made available.

3.19.5 Where a change of use of supported housing triggers  Grant Recovery, this may be deferred until a further Relevant Event, when the amount to be Recovered will be calculated on the original Grant amount.

3.19.6 This deferral is at the discretion of the Agency (through agreement of the relevant Regional Investment Team.)  We will consider:

• any changes in revenue sources and amounts;
• the future needs of the current client group;
  changes in methods of supplying support, eg to floating;
• other potential client groups;
• the nature, type and condition of the building, currently and in future.

3.20 Change of use from Temporary Social Housing, Temporary Market Rent Housing, Short Life and ‘HAMA PLUS’

3.20.1 What is Temporary Social housing? Click on the asterisk.  

 

3.20.2 Where the intended life is achieved, Capital Grant is not Recoverable. 

3.20.3  Where two complete years of life are not achieved from the date of the lease, Capital Grant will be Recovered in full.  If more than two years life is achieved, the amount of Capital Grant Recovered will be reduced pro rata for the proportion of the life, in completed months, which has been achieved. 

3.20.4 The amount at Grant Recoverable in these situations is not dependent upon there being a sufficiently large Net Sales Receipts, and so the concept of Eligible Deductions is not applicable.

3.20.5 If there is a shortfall between the RSL’s receipt for early termination and the amount Recoverable (i.e. to be credited to the RCGF) Recovery of this shortfall can be deferred until a subsequent change of use or disposal occurs.  Capital Grant will not be written off should the compensation for the early termination of the lease be less than the amount of Capital Grant to be Recovered.

3.21 Cessation of use of land or property:  Void properties

3.21.1 Where an RSL has ceased to use land or Property for six months, the Agency must be notified. 

3.21.2 The RSL must produce proposals for either bringing the Property back into use, its demolition, or its disposal within [7] months of the property becoming void.. 

3.21.3 These proposals will be discussed with the Agency and a course of action agreed.  If the RSL does not implement the agreed course of action within a timetable and any extensions to it set by the Agency, the Capital Grant will be Recovered in accordance with the 'change of use’ procedures at para 3.17 above. 

3.22 Demolition

3.22.1The Agency’s approval must be obtained prior to demolition of a Property.
 
3.22.2 Demolition is a Relevant Event for the Recovery of Capital Grant

3.22.3 If the Property is be demolished because it had reached the end of its useful life (considering such factors as age, location, physical condition and property type in the context of current needs or market conditions.)  the Agency will not normally Recover Capital Grant at that time, but will defer it.

3.22.4 The Capital Grant liability is deferred until a future Relevant Event occurs, in which case the Capital Grant Recovery policy and procedures in force at that time will apply.

3.22.5 In the meantime Capital Grant is treated as remaining in the land.  

3.22.6 This Grant will not  be included in any value for money assessments undertaken by the Regional Investment Team when deciding whether or not to provide additional Grant to redevelop the site.  In other words, the "dormant" Capital Grant in the land will not make any future redevelopment scheme look artificially expensive in terms of subsidy requirements.

3.22.7 For an example click on the asterisk.  
 

 

3.22.8 If the RSL demolishes property so that the resultant vacant site:

1. remains in the ownership of the RSL;
2. is to be used for non-income earning purposes (such as forming an open space or facilitating the realignment of roads) and
3. a compensation payment is received by the RSL

then Capital Grant will be Recovered. 

3.22.9 The Eligible Deductions from the Gross Sale Receipts (in this case the compensation payment) are the Deemed Loan Debt and the reasonable expenses incurred (excluding the costs of demolition). 

3.22.10 If the Net Sale Receipt is insufficient to allow full Recovery of the Grant, the shortfall will not be written off, but will remain dormant in the land concerned, as is the case for demolition as per para 3.22 above.

3.23 Change of Ownership

3.23.1 Transferring Grant funded property from one RSL to another, or from an Unregistered Body to an RSL is not a Relevant Event, and so Grant Recovery is not triggered.  Instead, the receiving RSL takes on the liability for Grant Recovery as if they had received the Capital Grant themselves in the first place. Such Grant will then become recoverable should Relevant Events arise when the property is in the ownership of the receiving RSL.

See Recovery Determination (25)

3.23.2 Receiving RSLs should ensure they keep adequate records of Capital Grant paid in respect of properties being transferred for future reference