Variation of leases: Reducing the rent payable: Example 1
L grants a lease to T:
* of non-residential property * on 1 December 2000 * for a term of 35 years * at a rent of £650,000 per annum * subject to upward only rent reviews every five years.
On 1 July 2005 T pays L £10,000,000 to reduce the rent for the remainder of the term to 1p.
A land transaction return and payment of £400,000 tax is required no later than 31 July 2005, as the payment by the tenant to the landlord to reduce the rent is liable to tax at 4% of £10,000,000.