SDLTM07950 - Scope: When is stamp duty land tax chargeable

Contracts and substantial performance: Substantial amount of the consideration FA03/S44(5)(b)

A contract will be substantially performed in advance of completion where the purchaser has paid substantially all of the consideration specified in the contract.

In deciding whether or not a substantial amount of the consideration has been paid or provided, regard needs to be had to whether the rent represents the whole or part of the consideration. If

• none of the consideration is rent the substantial performance is when the whole or substantially the whole of the consideration is paid or provided
• the only consideration is rent the substantial performance is when the first payment of rent is made
• the consideration includes both rent and other consideration the substantial performance is when the whole or substantially the whole of the consideration other than rent is paid or provided, or the first payment of rent is made. Whichever happens earlier will trigger the charge

Substantially the whole means an amount equal to or greater than 90 per cent of the total consideration due under the contract unless the circumstances of the transaction are such that in substance the whole of the consideration has been paid or provided.

Such a case might be an arrangement where a contract dated January 2004 provides for the purchase of a property with a market value of £10m and provides for payment of £15m with £10m payable now and the balance in 2099.