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HMRC internal manual

Stamp Duty Land Tax Manual

Calculation of Stamp Duty Land Tax (SDLT): Rent: Variable or uncertain rent: Five-year rent reviews: Example 3

An agreement for lease is entered into on 1 January 2004 for a rent of £100,000 per annum subject to review to market rent at 1 January 2009. It is substantially performed on 1 January 2004 so is treated as the grant of a notional lease.

On 1 January 2006 a lease is granted pursuant to the agreement, which is regarded as the surrender of the notional lease under the agreement and a re-grant (refer to SDLTM10040 for details).

For the purposes of FA03/SCH17A/PARA7A, the re-grant ‘re-starts the clock’ in terms of the time limit for the provisions. The review under the new lease takes place on 1 January 2009, which is only 3 years from the date of re-grant. The provisions of FA03/SCH17A/PARA7A do not therefore apply.