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HMRC internal manual

Stamp Duty Land Tax Manual

Calculation of Stamp Duty Land Tax (SDLT): Rent: Variable or uncertain rent: Example 2

A lease is granted on 1 January 2018 for a term of five years at a rent of £150,000 per annum with provision for a rent increase on 1 January 2020 to reflect the current market value

Year 1 £150,000
Year 2 £150,000
Years 3, 4 & 5 Market rent


As the rent for years 3, 4 and 5 is unascertainable as at the date of grant, a reasonable estimate of the market rent should be used by virtue of FA03/SCH17A/PARA7 and FA03/S51. The estimate is that the rent will be £160,000 for each of these years. A return is submitted by 31 January 2004 with a net present value (NPV) of £703,411 and tax due of £5,534


The rent review is concluded on 1 July 2020 and the annual rent for years 3, 4 and 5 is adjusted to market rent of £165,000.

An amended return by way of a letter to Stamp Taxes is required by 31 July 2006, disclosing the actual NPV of £716,488 based on the actual figures and payment of additional tax of £110.

If this review concluded on 1 July 2023 to produce rents for years 3, 4 and 5 of £165,000, the following would be required:

  1. by 31 January 2023 a revised return by way of letter to Stamp Taxes if it was reasonable at that date to estimate that the rent would be more than the previous estimate of £160,000 in respect of years 3, 4 and 5 (by virtue of FA03/SCH17A/PARA8(1)(a) andFA03/SCH17A/PARA8(3));
  2. by 31 July 2023 a revised return by way of letter to Stamp Taxes to give the actual NPV of the lease, even if a return had been made under (1) above. Although the five-year point has now passed, the original return has been shown to be incorrect so correction is required to prevent a penalty accruing under FA03/SCH10/PARA8.