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HMRC internal manual

Stamp Duty Land Tax Manual

From
HM Revenue & Customs
Updated
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Reliefs: Right to buy transactions, shared ownership leases etc: Notes to assist the completion of the SDLT1 land transaction return

These notes provide guidance on how to complete the land transaction return in various circumstances where notifiable transactions take place in connection with a shared ownership lease. Transactions other than those listed are not generally notifiable but if you are in any doubt about this please telephone the Stamp Taxes Helpline on 0300 200 3510.

Grant of a shared ownership lease: market value election: freehold reversion available

  • Box 2: enter code L
  • Box 9: enter code 05 if disadvantaged areas relief is being claimed, otherwise leave blank
  • Box 10: leave blank
  • Box 14: enter the tax due on the full market value as shown in box 24
  • Complete boxes 16 to 22 and box 24
  • Box 20: enter Nil
  • Box 22: enter the market value stated in the lease
  • Box 24: enter the tax due on that market value.

Grant of a shared ownership lease: market value election: leasehold property

  • Box 2: enter code L
  • Box 9: enter code 05 if disadvantaged areas relief is being claimed, otherwise leave blank
  • Box 10: leave blank
  • Box 14: enter the sum of the amounts shown in boxes 24 and 25
  • Complete boxes 16 to 25
  • Box 20: enter the minimum rent stated in the lease. If this is a peppercorn enter “0”
  • Box 22: enter the open market premium stated in the lease
  • Box 23: enter the Net Present Value (NPV) of the minimum rent stated in the lease
  • Box 24: enter the tax due on the open market premium
  • Box 25: enter the tax due on the NPV of the minimum rent.

Grant of a shared ownership lease: no market value election

  • Box 2: enter code L
  • Box 9: enter code 05 if disadvantaged areas relief is being claimed, otherwise leave blank
  • Box 10: leave blank
  • Box 14: enter the sum of the amounts shown in boxes 24 and 25
  • Complete boxes 16 to 25
  • Box 20: enter the initial rent payable under the lease
  • Box 22: enter the premium paid for the grant of the lease
  • Box 23: enter the Net Present Value (NPV) of the initial rent, measured over the full term of the lease
  • Box 24: enter the tax due on premium
  • Box 25: enter the tax due on the NPV

Staircasing transactions: no market value election: tenant acquires a share of the property in excess of 80%

These transactions will only be notifiable if the consideration given for the transaction exceeds the SDLT threshold. For this purpose these transactions are treated as linked to the grant of the lease or to any earlier staircasing transaction.

  • Box 2: enter code O
  • Box 9: leave blank
  • Box 10: enter the amount of the payment made for the additional share
  • Box 13: enter “yes”
  • Box 14: enter the tax due on the amount shown in box 10
  • Do not complete boxes 16 to 25.

Staircasing transactions: market value election: acquisition of freehold reversion

This transaction is notifiable even though no tax is payable.

  • Box 2: enter code F
  • Box 9: enter code 28
  • Box 10: enter the amount of the final payment
  • Box 14: enter “0”.

Staircasing transactions: market value election: tenant is granted a new lease on acquisition of the maximum leasehold interest available under the shared ownership lease

This transaction is notifiable even though no tax is payable.

  • Box 2: enter code L
  • Box 9: enter code 28
  • Box 14: enter “0”
  • Complete boxes 16 to 25
  • Box 22: enter the amount of the final payment
  • Box 23: enter “0”
  • Box 24: enter “0”
  • Box 25: enter “0”.

Staircasing transactions: no market value election: tenant acquires freehold reversion

This transaction will be notifiable if the final payment exceeds £40,000, even if no tax is payable. For this purpose the transaction is treated as not linked to the grant of the lease or to any other staircasing transaction.

  • Box 2: enter code F
  • Box 9: leave blank
  • Box 10: enter the amount of the final payment
  • Box 13: enter “no”.
  • Box 14: enter the tax due on the amount shown in box 10.

Staircasing transactions: no market value election: tenant is granted a new lease on acquisition of the maximum leasehold interest available under the shared ownership lease

  • Box 2: enter code L
  • Box 9: leave blank
  • Box 13: enter “no”
  • Box 14: enter the sum of the amounts shown in boxes 22 and 23
  • Complete boxes 16 to 25
  • Box 22: enter the amount of the final payment
  • Box 23: enter NPV of the rent payable under the new lease
  • Box 24: enter the tax due on the amount shown in box 22
  • Box 25: enter the tax due on the NPV shown in box 23.