SDLTM11010 - Chargeable Consideration: Rent

A lease or other chargeable transaction where the chargeable consideration wholly or partly consists of rent is chargeable to SDLT on the 鈥榬elevant rental value鈥�.

As rent is not defined for SDLT purposes it will take its ordinary meaning - i.e. a periodic payment for the use of land/property.

Whether consideration constitutes rent is a question of fact. Consideration may be treated as rent for SDLT purposes despite being described otherwise, for example as a licence fee in an agreement for lease. Conversely, a service charge may be reserved as rent in the lease but not treated as such for SDLT purposes.

鈥楻ent鈥� does not include consideration payable before a new lease is granted). Insome circumstances this may be taxed as a premium.

A nominal rent is not normally chargeable consideration for SDLT purposes if it:

  • is expressed as a peppercorn or similar, or
  • has a net present value (NPV) of less than 拢1.

Refer to:

SDLTM10045 and SDLTM10040 for details of other chargeable transactions.

SDLTM13075 for definition of relevant rental value.

SDLTM11015 for treatment of service charges etc.

SDLTM17110 and FA03/SCH5/PARA1A re: rent payable before lease granted.

SDLTM13075 for definition of NPV.