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HMRC internal manual

Stamp Duty Land Tax Manual

Miscellaneous Provisions: Substantial performance of an agreement: Example 2


A non-residential agreement for lease is exchanged on 1 January 2015 and is substantially performed on 1 February 2015. The lease expires on 30 April 2025. There is a rent review to market rent at the end of the fifth year. The lease is subsequently granted on 1 May 2015.

On substantial performance, the agreement for lease is notifiable as lease expiring on 30 April 2025. SDLT is payable to the extent the NPV exceeds the threshold.

The grant of the actual lease on 1 May 2015 will be a linked transaction to the notional lease created on substantial performance. No further notification should be required or tax due as SDLT has already been paid on the full term.