The Learning Page > Stamp Duty Land Tax (SDLT)

Stamp Duty Land Tax (SDLT) was introduced on 1st December 2003. SDLT is a tax on transactions, not documents. All grants of leases for a term of seven years or more must be notified to HM Revenue & Customs (HMRC) on a land transaction return, unless there is no premium and no rent of any monetary value. Leases for less than seven years need not be notified unless SDLT is payable on either the premium or rental element . Your solicitor or advisor will normally complete the return for you. But legally, you are responsible for the information submitted and must sign the declaration on the land transaction return.

Once the return has been processed and the appropriate amount of tax has been paid, a 'land transaction return certificate' (SDLT5) is issued (this replaces the old impressed stamp.) You’ll need this certificate for the Land Registries in UK and Northern Ireland, or for the Registrars of Scotland when applying for registration of title or documents. If the land transaction return and/or payment isn’t sent to HMRC within 30 days of the effective date of the transaction, penalties and interest might be payable.

SDLT is charged on the ‘net present value’ (NPV) of the total rent payable over the term of the lease. SDLT is due at 1% on the value exceeding £150,000.