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HMRC internal manual

Stamp Duty Land Tax Manual

Scope: When is Stamp Duty Land Tax (SDLT) chargeable: Contracts and substantial performance: Purchaser takes possession FA03/S44(5)(a)

A contract will be substantially performed where the purchaser obtains “the keys to the door” and is entitled to occupy the property (however this is documented) or when the purchaser of a building that is let becomes entitled to receive the rents.

It is immaterial whether the purchaser takes possession under the contract or under a licence or lease of a temporary character.

Where the purchaser already has occupation of the premises under a different interest, for example when the purchase is of a freehold and the purchaser is a tenant, substantial performance will not be triggered at the time of the contract as long as the purchaser adheres to the covenants in the lease.

Where premises are entered into for fitting out that will count as possession and the time the trade commences is not relevant.