SDLT on lease

SDLT on lease

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Client's company currently owns residential/commercial property. The residential property is situated above the commercial property. We are in the process of transferring this out of the company and into the name of the client. Client will live in residential property.

I understand that SDLT will be paid on the transfer (based on market value) above £125k for residential and £150k for non-residential (this is not a disadvantaged area).

1, Will SDLT be also payable when the commercial property is leased back to the company? No lease premium will be paid. Annual rent is £12,000. I understand its based on NPV of rents.

2, Alternatively, the residential property can be transferred only. This will be offered on leasehold basis for 999 years. The market value is £115,000. The annual rent is nil in this case. I assume no SDLT is payable in this case?

Your comments would be welcome.

S Hall

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