Stamp Duty Land Tax (SDLT)
Following the introduction of Stamp Duty Land Tax on 1 December 2003, the PSG thought that property professionals may find it helpful if common procedures and style documentation dealing with SDLT were prepared, particularly in respect of leasing and security transactions, where there was some uncertainty both as to procedure and styles.
- Leasing Transactions - Given the penalties and criminal sanctions which attach to the late or incorrect submission of a Stamp Duty Land Tax form, the general approach which the PSG has adopted is that a tenant has a greater interest than a landlord in ensuring that the appropriate form is timeously submitted and the Stamp Duty Land Tax (if any) paid. Once the Land Transaction Return has been issued by the Inland Revenue, it is up to a landlord and a tenant to decide who should be responsible for registering the Lease although, because an Extract confers on a landlord the benefits of summary diligence, the Landlord may wish to retain this responsibility.
- Security Transactions - Although there is no reason why a borrower should not be treated in the same way as a tenant in the submission of the SDLT form, from experience to date it appears unlikely that lenders will agree to this approach being adopted. As a result, the lender is likely to insist on the borrower delivering at drawdown of the loan a completed (and signed) SDLT form and (if any SDLT is payable) funds for SDLT. Undertakings will also need to be exchanged between the lender's and the borrower's solicitors regarding submission of the SDLT forms and dealing with any queries raised by the Inland Revenue.
As a result a Guidance Note, style contract wording for an Offer to Lease and style Undertakings for security transactions have been created.
- Guidance notes for SDLT (v5)
- SDLT Wording for an Offer to Lease – Landlords (Lease transaction where Landlords present Lease for registration in Books of Council and Session) (v3)
- SDLT Wording for an Offer to Lease – Tenants (Lease transaction where Tenants present Lease for registration in Books of Council and Session) (v3)
- SDLT Undertaking 1 (Security transaction where Borrower's solicitor presents SDLT form) (v3)
- SDLT Undertaking 2 – Lender (Security transaction where Lender's solicitor presents SDLT form) (v3)
- SDLT Undertaking 3 – Borrower (Security transaction where Lender's solicitor presents SDLT form) (v3)
- SDLT Undertaking 4 (Security transaction where Borrower's solicitor presents SDLT form electronically) (v1) - Now incorporated in Undertaking 1
Archived versions: 1