As a general rule, a lease for a period of more than nine years (known as a contract lease) incurs court stamp upon its creation, assignment or extension. A sub-lease with a term of more than nine years will be subject to stamp on the same basis.
Contract leases are passed before the Royal Court from 2.30pm on a Friday and cannot be completed at any other time or day of the week. A copy of each contract lease and related assignment or variation is contained within the electronic Public Registry system and is publicly accessible.
As a general summary, stamp is determined by multiplying the annual rental (market value should be used where the rent under the lease is at a lower level) by the number of years of the term (up to 21 years, no additional sum is payable for any longer term) or the balance of the term in the case of an assignment. In all cases a part of a year is rounded up to a full year. Stamp duty is payable on the resulting sum at the rate of 0.5% on the first £100,0000 and 0.75% above that figure. Our court stamp will calculate the precise stamp duty payable for any transaction. Click here to calculate using our Leasing Calculator.
A break option does not serve to reduce the stamp, but pre-determined rent reviews in the lease will be taken into account. Any additional consideration by way of premium (or even reverse premium) will attract stamp duty at the rate applicable for freehold property purchases. Click here to calculate using our Freehold Calculator.
Where a lease of dwelling accommodation is to be granted to or assigned to a person who qualifies as a first time buyer, concessionary rates apply.
In addition to the basic stamp fee an £80 registration fee and a £20 jurat fee is payable on the passing of each contract.
The information and expressions of opinion contained in this guide are not intended to be a comprehensive study or to provide legal advice and should not be treated as a substitute for specific advice concerning individual situations.
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