Further to our previous blog posts on Stamp Duty Land Tax (“SDLT”), it is worth bearing in mind that SDLT falls due on the date that the purchase contract is substantially performed. Deemed substantial performance of the contract will differ in each transaction and will turn on the facts. Persuasive factors include whether any part of the purchase price (generally 90% of more) or any rent has been paid or if the buyer has gone in to possession.
Commercial tenants taking a lease of premises should not forget that Stamp Duty Land Tax (”SDLT”) may be payable. The SDLT is calculated on, what is known as, the Net Present Value (“NPV”) of the rent payable over the term of the lease. The minimum threshold for commercial leases is £150,000. For leases of commercial or mixed property, the SDLT rate is 1% for excess NPV up to £5 million and 2% when the NPV exceeds £5 million.
If you have found that your landlord has sold the superior interest to the long leasehold of your flat to a third party without consulting you or your neighbouring tenants, the landlord may be in breach of the obligation to first offer to sell its interest to the tenants of the building.
If you own a residential flat held on a long lease you may think you own your flat outright and, to an extent, you do but only for the term of years granted by the lease and each year that passes that term is reduced.