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HMRC internal manual

Stamp Duty Land Tax Manual

Calculation of stamp duty land tax: Rent: Variable or uncertain rent: NPV: Example 1

A ten year lease is granted on 1 April 2004. Annual rents are due per the table below:

Year 1 £50,000
Year 2 £50,000
Year 3 £60,000
Year 4 £60,000
Year 5 £70,000
Year 6 £70,000
Year 7 £80,000
Year 8 £80,000
Year 9 £90,000
Year 10 £90,000

The actual rent payable for years 1 to 5 will be taken into account for the purposes of the net present value (NPV) calculation.


The figure of rent to be used for years 6 to 10 is £70,000, being the highest rent payable in a consecutive period of 12 months in the first five years of the term of the lease.

The fact that the rent actually payable for years 6 to 10 is known (and exceeds £70,000) is not relevant for the purposes of calculating the NPV of variable rents.