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SDLT on residential rent

Confused on liability and process

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I am a residential renter in London, and have been in my (expensive) flat for four years. In November I will be asked whether I want to renew the tenancy. If I do that, my cumulative rent will reach the £125k threshold and I will become liable for SDLT around August/September 2021.

Having looked at the HMRC guidance on this and done a test run on the calculator, I am left with many more questions than answers. Guidance on other websites seems to be of variable quality too.

I don't understand why I'd be charged a higher rate on a 'premium' when I thought SDLT was just 1% of the rent. Do I need to submit a form every month for the rent paid? For the sake of what could be about £20 a month, the whole process feels very onerous.

As my accountant doesn't deal with personal matters for me, I'm trying to work this out myself before resorting to paying for professional advice. Is there a really simple, plain English, guide on what to do? That's really all I want - an idiot's guide that explains it all.

Thank you :)

Replies (7)

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By Anonymous.
01st Sep 2020 11:06
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Replying to Anonymous.:
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By fluffymitten
01st Sep 2020 11:21

Yes, I have been reading that. Sadly, doesn't make much sense to me!

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Replying to DJKL:
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By fluffymitten
01st Sep 2020 12:16

I read that one too, which doesn't explain about the 'premium' element which attracts a higher rate.

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Hallerud at Easter
By DJKL
01st Sep 2020 12:23

What premium?

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Replying to DJKL:
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By fluffymitten
01st Sep 2020 13:58

It's referenced here. When I put six years' rent into the calculator, some of my rent over the £125k threshold was charged at 1% and some was deemed 'premium' and charged at a higher rate and I don't understand what it is

https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdlt...

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Replying to fluffymitten:
Hallerud at Easter
By DJKL
01st Sep 2020 14:07

"Note that in certain circumstances:

‘rent’ payable in respect of the period before the date on which the lease is granted may be taxable as a premium. Refer to SDLTM17110."

Could this be what is causing the issue, are the earlier years before now effectively being treated as a premium, is it perhaps something to do with the dates being used within the calculator?

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