Introduction: Scope of stamp duty land tax on leases: Pre-implementation leases
Only a lease that is expressly granted, or is treated as having been granted, for the first time on or after 1 December 2003 can be chargeable to stamp duty land tax (SDLT).
Transactions which are treated as grants of a new lease for SDLT purposes include:
* renewals * extensions and * certain variations (see SDLTM19030), and * variations of pre-SDLT leases within the first five years of the term (treated as the grant of a new lease for consideration equal to the increase in rent: see SDLTM18740).
Where the effective date of these transactions is on or after 1 December 2003, they are subject to the SDLT provisions. See SDLTM17645 for further details.
A lease will not be subject to SDLT if it was granted before 1 December 2003 but continues after that date because it:
* continues by operation of law e.g. by tacit relocation * is a lease which continues after the expiration of the fixed term (e.g. short assured tenancies).
Where parties have occupied premises prior to 1 December 2003, and the terms of the lease are reduced to writing after 1 December 2003, in practice HMRC will accept that the lease is subject to stamp duty even though no written contract was in existence prior to 1 December 2003.