Stamp duty land tax on lease

[WoodYouLike]

We are negotiating a lease on a little shop at the moment. Not very familiar with some of the terms and or standard fees tenant is supposed to pay on top of the rent:
the draft agreement mentions Stamp Duty Land Tax on the lease to be paid by tenants.

Have tried to find more info on the IR website, but can't figure out if we are expected to pay the tax on the value of the property itself, on top of the rent chargeble.

Anyone?

 

[david and julie]

Although I own and rent out some industrial units I don't get involved with the legal side.

However, I understood the stamp duty payable was based on the value of the rent over the lease term. IE, you rent a building worth say £250K, you take a lease at say £15K PA X 5 years. The stamp duty payable would be on 5x15= £75K and not on the £250K.

My solicitor does this for me and the tenants are liable for the duty so I don't actually see the bills, but I am certain this how it works. Ask your solicitor if in doubt. Their fees are for advising you in all aspects of this matter and shouldn't go up due to you seeking clarification on anything.

The fees to be wary of, on leases, are service charges as these can usually be altered mid stream by the landlord. If it is not a new property I would also suggest you either consider a survey, or at least take pictures of any areas which are damaged. Upon yield up (or giving back) the landlord may have a survey and try to make you pay for reinstatement of existing problems otherwise.

Have a look at this calculator, I haven't tried it but it may help you.

http://ldcalculator.inlandrevenue.gov.uk/

 

[WoodYouLike]

Cheers

So we only pay Stamp Duty on the value of the rent. Using the calculator that means no stamp duty (But will check with solicitor before we think ourselves 'rich')
Services charges we are indeed wary of, it is mentioned, but no amount named as yet, very tricky.

Property is new build (not finished yet, still a few weeks to go).

 

[david and julie]

May be worth asking the local council if they have an economic development officer or if you are in a regeneration area or the like. You never know you may be able to get some help or a rate free period.

Costs nothng to ask and you never know your luck.

 

[WoodYouLike]

No, don't think so. We're in a rather affluent village and the proprietor of the neighboring (new and finished) shop already had his rates calculated (with small business discount). I'm sure we will get 50% discount on the small business tariff.

But thanks anyway