Calculation of stamp duty land tax: Rent: Rate thresholds
Once the net present value (NPV) of the rental payments has been calculated (refer to SDLTM13075), the stamp duty land tax (SDLT) on the rent may be calculated. To calculate SDLT on a single lease:
- the relevant land is the land that is the subject of the lease
- the relevant rental value is the NPV of the rent payable over the term of the lease
If the lease in question is one of a number of linked transactions (refer to SDLTM17035) where the consideration consists of or includes rent, then:
- the relevant land is any land that is the subject of any of those leases and
- the relevant rental value is the total of the NPV of the rents payable over the terms of those leases
The following rates apply depending on whether the relevant land that is subject to the lease is wholly residential (refer to FA03/SCH5/PARA2) . Please note that the £125,000 threshold for residential purposes is replaced by a temporary £175,000 threshold for transactions where the effective date is 3 September 2008 - 31 December 2009 inclusive.
|Relevant rental value (from 22 March 2006)||Rate of tax to apply|
|Up to £125,000||0%|
|More than £125,000||1% on excess over £125,000|
Non-residential or mixed type leases:
|Relevant rental value (from 1 December 2003)||Rate of tax to apply|
|Up to £150,000||0%|
|Over £150,000||1% on excess over £150,000|
Examples can be found at SDLTM13105.