Under review

Stamp duty land tax (SDLT) came into force on 1 December 2003. Many leases granted on or after that date working on a five-year cycle will shortly have their first rent review. If, after 1 December 2008, the tenant under such a lease suffers a substantial increase in the rent on review, it will now be subject to an SDLT charge, as a result of the introduction of a new liability relating to “abnormal rent increases”.

In the current climate, where many tenants are actively seeking concessions in rent, this burdensome liability coupled with an increase in the rent itself, may be one financial outlay too far. To further add to tenants’ woes, despite a five year lead-in period which HM Revenue & Customs (HMRC) had to finalise the legislation in this area, HMRC only recently acknowledged that the rules currently on the statute book which come into force on 1 December 2008 are unworkable and require amendment. However, any such amendment