The Government announced on 2 September 2008, a temporary exemption from Stamp Duty Land Tax, for acquisitions of residential property worth not more than £175,000. The exemption applies where:

• the effective date of the land transaction (normally the date of completion) is on or after 3 September 2008 and before 3 September 2009
• the transaction is for a chargeable consideration of not more than £175,000
• the property must be exclusively residential, and
• in the case of leasehold properties, only applies to grants of leases for more than 21 years or assignments of leases with 21 or more years to run.

The exemption is not available for any land transaction either before 3 September 2008 or after 3 September 2009.

Claimants for exemption must still submit an SDLT return with HM Revenue & Customs and must enclose either an SDLT5 certificate, or submission receipt when lodging their application with Land Registry.

Further information about the exemption will be published on the HM Revenue & Customs website.

When is SDLT evidence not required?

No SDLT evidence is required for the following situations where the transaction was completed on or after 12 March 2008:

• An acquisition (other than the grant, assignment or surrender of a lease) where the chargeable consideration for that acquisition (together with any linked transaction) is less than £40,000. This includes, for example, transfers of freehold land, deeds of gift and deeds of grant of easements. This covers the noting of interests as well as their substantive registration.

• The grant of a lease for 7 years or more where

  • the premium is less than £40,000 and

  • the annual rent is less than £1,000.

• The assignment or surrender of a lease where

  • the lease was originally granted for a term of 7 years or more; and

  • the consideration for the assignment or surrender, other than any rent, is less than £40,000; and

  • the rent is less than £1,000.

• The grant, assignment or surrender of a lease for a term of less than 7 years where the premium does not exceed the zero-rate threshold, i.e. £125,000 for residential properties and £150,000 for commercial properties.

• SDLT evidence is also not required for transactions exempted under Schedule 3 to the Finance Act 2003.

When is SDLT evidence required?

An SDLT5 (including submission receipts (electronic SDLT5) and third-party vendor certificates) is required for all other transactions, which are not non-major transactions.

Non-major interests

The acquisition of a chargeable interest other than a major interest in land remains notifiable only where there is chargeable consideration for which SDLT is due at a rate of 1% or more. The acquisition of an easement, for example, is an acquisition of a chargeable interest other than a major interest in land. So, if the chargeable consideration on it was at the rate of 1% or higher, the transaction would be notifiable. SDLT evidence is not required if the consideration is between £40,000 and £125,000 for residential land and between £40,000 and £150,000 for commercial land.

General

Any application being stood over by Land Registry awaiting an SDLT60 will be completed regardless of when the transaction was completed, subject to other outstanding requisitions.

Land Registry is in the process of updating its internal and external guidance. Affected Practice Guides will be updated at the earliest practical opportunity.

Further details of the SDLT Budget changes can be found on the HM Revenue & Customs website