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HMRC internal manual

Stamp Duty Land Tax Manual

Introduction: definitions: tenancy at will

A tenancy at will is an arrangement, whether documented or not, where a tenant occupies land as tenant (for example, not as servant or agent) with the consent of the owner, on the basis that the arrangement can be brought to an end by either party at any time.

The arrangement will also automatically cease if either party dies or if the owner sells the land. A tenancy at will does not create an estate and thus cannot be assigned.

Under the provisions of FA03/S48(2)(c)(i) a tenancy at will is an exempt interest, which means that it is outside the scope of the SDLT regime.

Whilst this may seem to be at odds with the provisions at FA03/SCH17A/PARAS1(b) and 4(5)(b) those provisions merely serve to put beyond doubt that for the purposes of SDLT a tenancy at will is a lease and do not override the provisions of FA03/S48.

The effect of the provisions combined is to affirm that a tenancy at will is a lease, but that it is a type of lease that is an exempt interest.