Q&As

Where a landlord has agreed a reduced concessionary rent in a side letter, is stamp duty land tax payable on the rent as set out in the lease or payable on the reduced rent?

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Produced in partnership with Sean Randall of Blick Rothenberg
Published on: 21 February 2020
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It is assumed that the land is in England or Northern Ireland.

Stamp Duty Land Tax (SDLT) is payable on the grant of a lease on any premium given by the tenant and the Net present value of the rent payable over the term of the lease. The question is, what is the correct amount of rent to be taken into account in the net present value calculation—the amount of rent stated in the lease or the reduced amount of rent stated in the rent

Sean Randall
Sean Randall

Blick Rothenberg

Sean is a partner at Blick Rothenberg. For five years, he was head of stamp taxes at KPMG UK, finalist in the 2016 Taxation Awards for Best Big Four Tax Group. He has almost 20 years' experience advising, amongst others, developers, investors, occupiers, funds and banks on stamp taxes in connection with real estate transactions, group reorganisations, corporate reconstructions, demergers and placings. He is a barrister by training, a Fellow of the Chartered Institute of Taxation and council member of the Stamp Taxes Practitioners Group. Since 2007 he has been the editor of Sergeant & Sims on Stamp Taxes arguably the most comprehensive, up-to-date and authoritative guide to UK stamp taxes available. He was the Tax Writer of the Year in the 2017 Taxation Awards having ''demonstrated real in-depth expertise in analysing complex legislation'. He has contributed to the development of government policy, tax authority practice and statutes on stamp taxes, and is regularly consulted by tax authorities and government departments. He speaks and writes regularly on UK stamp taxes.

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Jurisdiction(s):
United Kingdom
Key definition:
Side letter definition
What does Side letter mean?

An agreement with a specific investor in a fund which amends the fund’s main constitutional document, for example a limited partnership agreement, in respect of a particular investor.

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