Service charges payable from tenant to landlord are not chargeable consideration for stamp duty land tax (SDLT) purposes and are excluded from the calculation of tax as long as payment of service charge has been either:
The fact that a service charge is reserved in the lease as rent
does not make it rent for SDLT purposes.
Where apportionment of an inclusive figure is needed, this must be made on a just and reasonable basis for SDLT purposes and will not necessarily be the same as the apportionment (if any) set out in the lease documentation.
Where a single sum is payable in respect of rent or of rent and service charges and:
Service charges are the most common item of non-chargeable
consideration for a lease, but the above treatment applies equally
to other non-chargeable consideration, under FA03/SCH17A/PARA6.
Refer to FA03/SCH4/PARA4 re: just and reasonable apportionment.
Refer to SDLTM11060 re: non-chargeable consideration.