Additional details for cases involving leases

There is no need to read this section if your land transaction is not for the grant or assignment, in Scotland assignation, of a lease or of a freehold subject to a lease. Purchasers of those interests should read the paragraphs below for guidance as to whether they need to complete section 2 of form SDLT1 and/or section 2 of form SDLT4.

Shared ownership leases: there are special rules for a shared ownership lease. For all shared ownership leases please refer to our guidance at SDLTM27080.

Form SDLT4 questions 10 to 39

Use the About Leases section of SDLT4 for:

  • the grant of a lease, which is shown as either 'mixed' code 02 or 'non residential' code 03 at Question 1 of the SDLT1
  • a single transaction to acquire multiple leasehold properties by grant or assignment or in Scotland assignation - separate chargeable interests or separate plots of land, the number having been entered on form SDLT1 at question 26 and the first property identified at question 28. Enter each property on a separate form SDLT4
  • linked leasehold transactions. If a lease is linked to the lease shown in the 'About Leases' section of the SDLT1 and it:
    • shares the same effective date and
    • has identical purchasers and identical vendors and
    • comes within exactly the same code, either A or L for question 2 of SDLT1 and
    • in common with all the other linked leases either is claiming no relief at all (answer 'No' in the first part of question 9 of the SDLT1), or is claiming exactly the same kind of relief (the code for that relief is entered in part two of question 9 of the SDLT1).

you may use an SDLT1 for the first lease and multiple forms SDLT4, one each for the other leases giving details of the linked lease in this part. See notes for question 13 of the SDLT1.

Note: if there are six or more properties involved in any one transaction refer to Multiple acquisitions and complex transactions.

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See below for the questions to answer for particular transactions:

Transaction SDLT4 questions for completion Notes

Transaction where there is a lease involved (code A on SDLT1 question 2) with multiple properties

Questions 10 to 16 for each additional property not shown on the SDLT1

If any property is non-residential or mixed also complete questions 1 to 9

Grant of lease (code L on SDLT1 question 2) with multiple properties

Questions 10 to 16 for each additional property not shown on the SDLT1. If any part of the property is non-residential or mixed use, complete lease questions 28 to 39 on one of the forms only.

If any property is non-residential or mixed also complete questions 1 to 9

Assignment of lease (code A) of single non-residential or mixed property

No need to complete part 2 of form About Leases

Also complete questions 1 to 9

Surrender of lease (code A) of single non-residential or mixed property, (chargeable consideration received from landlord)

No need to complete part 2 of form About Leases

Also complete questions 1 to 9

Grant of lease (code L) of single non-residential or mixed property

Questions 28 to 39

Also complete questions 1 to 9

Lease linked to lease entered on SDLT1 would also be code A at question 2

Questions 10 to 23

Complete SDLT1 at question 14 to
show total tax payable for all linked transactions; include this total
at question 15

Lease linked to lease entered on SDLT1 would also be code L on SDLT1 question 2

Questions 10 to 27 plus Questions 28 to 39 for any lease of a property which is non-residential or mixed

 

Complete SDLT1 question 14 to show total tax payable for all linked transactions; include this total at question 15

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SDLT4 Q10. Type of property

Follow notes for form SDLT1, question 1.

The code shown at this question of form SDLT4 should be the same as the code used at question 1 of the SDLT1.

SDLT4 Q11. Address or situation of land

Single property or title - SDLT1 question 2 code L

If the transaction involves a single property or title described in questions 16 to 33 of the SDLT 1 put X in the first box and go straight to question 28. Answer those of questions 28 to 39 that are relevant.

Multiple properties or titles and 'linked' leases

For a single lease, either a lease newly granted (code L at question 2 of the SDLT 1) or an existing lease acquired (code A at question 2 of the SDLT 1), but with more than one property, address or location.

At question 26 on form SDLT1 you have entered a number which is 2 or greater than 2.

For a 'linked' lease, you have entered the first lease on form SDLT1 indicating at question 13 that there is another linked transaction. Complete questions 10 to 16 of a form SDLT4 for each additional property or for the property covered by the linked lease.

Supply the full postal address if it has one, starting with the postcode followed by the house or building number and finally by the rest of the address.

If the property is in Northern Ireland the rest of the address must include the county in which it is situated.

If the address of the land or property does not have a postcode or other identifying house or building number describe its situation under the 'rest of address' section and ensure that a plan is attached (see question 16 below).

SDLT4 Q12. Local authority number

Follow notes for SDLT1 question 29.

SDLT4 Q13. Title number

Follow notes for SDLT1 question 30.

SDLT4 Q14. NLPG UPRN

Leave blank if not available but if you know or are able to find the number enter it here.

Follow notes for SDLT1 question 31.

SDLT4 Q15. Area of land

Complete only where the transaction is for or includes agricultural or development land.

Follow notes for SDLT1 question 32.

SDLT4 Q16. Is a plan attached?

Follow notes for SDLT1 question 33.

SDLT4 Q17. Interest transferred or created

Enter the appropriate code following the notes for SDLT1 question 3.

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SDLT4 Q18. Type of lease

Select one code relevant to the lease in question:

  • Residential - R
  • Non residential - N
  • Mixed - M

See also notes for SDLT1 question 16.

It is possible that the code you select for question 18 may not correspond with the type of property code selected at question 10.

SDLT4 Q19. Start date as specified in lease

Follow notes for SDLT1 question 17.

SDLT4 Q20. End date as specified in lease

Follow notes for SDLT1 question 18.

SDLT4 Q21. Rent-free period

Follow notes for SDLT1 question 19.

SDLT4 Q22. Annual starting rent inclusive of VAT (actually) payable

Follow notes for SDLT1 question 20.

SDLT4 Q23. Amount of VAT

Show the actual amount of VAT if any, included in the starting rent at question 22 plus any VAT included in the total premium payable shown at question 24.

Questions 24 to 27 must only be completed for a linked lease code L. If any question does not apply enter 0. For anything other than a linked lease code L leave these questions blank.

SDLT4 Q24. Total premium payable

Follow notes for SDLT1 question 22.

SDLT4 Q25. Net present value upon which tax is calculated

Enter the NPV in respect of this lease only.

Follow notes for SDLT1 question 23.

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SDLT4 Q26. Total amount of tax due - premium

The tax due on the premium is calculated as explained for question 13 of the SDLT 1. See also notes for SDLT1 question 24.

If there is no premium, for example for a lease at a full rack rent, enter 0.

SDLT4 Q27. Total amount of tax due - NPV

Follow notes for the SDLT1 question 25 if there is no net present value enter 0.

SDLT4 Q28. Any terms surrendered

Note: Only answer questions 28 to 39 if you have entered L at question 2 of the SDLT1.

If the lease was granted as a replacement for a lease of the same property to the purchaser, what were the terms of the former lease surrendered by the purchaser? The terms should include the rent returned under the previous lease and the period of its un-expired term.

Confine your answer to 30 characters including spaces.

SDLT4 Q29. Break clause type

Tell us if the contractual term can be broken either by the landlord or by the tenant or if the lease provides for either party to break the term. If there is more than one date when a break clause may become operative give details only of the first occurrence after the effective date. Leave blank if there is no break clause.

If there is a break clause you must also answer question 30.

SDLT4 Q30. Date of the break clause

Having answered question 29, enter the date on which the break clause shown at question 29 could first operate.

SDLT4 Q31. Which of the following relate to this lease?

Select from the options on the return. Leave blank if none apply. If more than one apply mark all which apply.

Option to renew

Mark with an X if, at the end of the period of the lease, the tenant has a right, or may exercise an option, to renew or extend the lease.

Such a right or option may be as a result of legislation, for example Landlord and Tenant Act 1954, or of an agreement between landlord and tenant either within or outside the terms of the lease.
Leave blank only if the lease cannot be renewed or extended.

Market rent

Enter X if the rent reflects an open market rent for the land and buildings. Leave blank if the rent is either above or below an open market value.

Turnover Rent

Some commercial leases include a rent which will be based on the turnover or profits of the business concerned. It is not usually possible to quantify such rent at the date of the lease. If any part of the rent reserved is to be based on either turnover or profits, mark with an X.

Unascertainable rent

If the whole or any part of the rent reserved for the term cannot be quantified at the date the lease is granted or acquired and the lease does not reserve a contingent rent, either minimum or maximum, mark with an X. This includes rent-sharing leases where the rent payable is a proportion of the rents received or receivable but not contingent reserved rents which are described below.

Contingent reserved rent

A lease may reserve a minimum rent that is to be paid in certain circumstances. For example a rent review clause may provide that whatever happens at the time the rent is reviewed, the new rent will never be less than the rent previously paid ('upward only' review). Enter 'X' if a minimum rent is to be reserved for any reason.

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SDLT4 Q32. Rent review frequency

If the lease provides for the rent to be reviewed during the term, show how often the review will take place by entering the number of whole years to the nearest year between regular rent reviews.

SDLT4 Q33. Date of first review

If the lease provides for a review or reviews, show the date of the first review to take place after the effective date of the transaction.

SDLT4 Q34. Rent review clause (type)

Indicate the type of review, whether an agreement of the open market rent, a rent tied to movement in the Retail Prices Index or another type of review.

SDLT4 Q35. Date of rent change

Paragraph 7 Schedule 17A Finance Act 2003 applies where the lease provides either for specific rent changes, for example 'stepped rents' or for a mechanism such as a rent review that may result in changes to the rent payable during the term of the lease. If that applies enter the date of the first rent change that may occur during the term of the lease.

SDLT4 Q36. Amount of service charge

Enter the amount of any payments provided for by the lease (for each period indicated in your answer to question 37) to cover services, for example maintenance. Leave this question blank if:

  • the terms of the lease do not distinguish service charges from the rent paid for occupation of the property or
  • the service charge amount is unascertainable - but do enter any amount actually paid before the effective date

SDLT4 Q37. Service charge frequency

Show how often the service charge is to be paid.

SDLT4 Q38. Other consideration from tenant to landlord

If, apart from cash, there is any other form of consideration paid, performed or given by the tenant as a premium in order to acquire the lease, select from the codes below and enter the appropriate code (or codes if more than one) on the return.

Other Considerations Code Manual

Debt (includes assumption by purchaser of outstanding mortgage)

01

SDLTM04040

Building works

02

SDLTM04060

Employment

03

SDLTM04080

Other (such as an annuity)

04

SDLTM06010

Shares in a quoted company

05

 

Shares in an unquoted company

06

 

Other land

07

SDLTM04020

Services

08

SDLTM04070

Contingent consideration

09

SDLTM05010

SDLT4 Q39. Other consideration from landlord to tenant

SDLTM11045 If, apart from cash, any other form of consideration is paid performed or given by the landlord to induce the tenant, by way of a 'reverse premium' to acquire the lease, select the appropriate code (or codes if more than one) from the table above.