Stamp duty rent overlap relief when you get a new lease
Rent overlap relief
When a qualifying new lease replaces an old lease, SDLT may reduce the new lease rent for the period both terms overlap.
- The statutory rule has narrow entry conditions.
- The overlap period ends when the old term would have ended.
- The new lease rent cannot be reduced below zero.
Scroll down for the full analysis.
Read the original guidance here:
Stamp duty rent overlap relief when you get a new lease
If a new lease replaces an old one before the old term would have ended, stamp duty on rent may not count both rents in full. People call this rent overlap relief. It can reduce the rent used in the SDLT calculation for the shared period.
What this rule is about
A new lease can start while the old lease would still have had time left to run. Without this rule, the SDLT rent calculation could include rent for the same premises and the same period twice.
That is the problem the relief addresses. But it is not available whenever you simply sign a new lease.
What the official source says
The HMRC page is a contents page. It links to HMRC material on overlap relief, rent taken into account, and five examples. HMRC guidance is not law; the legal rule is in Finance Act 2003.
- In return for a new lease of the same or substantially the same premises, the old lease is surrendered.
- A protected business tenant requests and receives a new tenancy.
- A sub-tenant receives a new lease after the head lease ends in specified circumstances.
- Under the guarantee, a guarantor receives a replacement lease.
What this means in practice
For the overlap period, the rent under the new lease is reduced by the rent that would have been payable under the old lease. The overlap runs from the date of the new lease until the date when the old lease would have ended.
- Rent under the old lease must have been taken into account for SDLT on that old lease.
- No reduction can turn the new lease rent into a negative figure.
How to analyse it
Begin with the documents and dates. The label the parties use will not settle the answer.
- Identify why and how the old lease ended.
- Check whether the case fits one of the four statutory routes.
- Compare the premises under both leases.
- Work out the period the two lease terms overlap.
Example
Ravi surrenders a lease with six months left and receives a new lease of the same unit. Over those six months, the old rent would have been £5,000. Rent under the new lease for that period is £7,000. For the SDLT rent calculation, the new rent is treated as £2,000 for that period, not £7,000.
Why this can be difficult in practice
This is where people get it wrong: the leases must cover the same or substantially the same premises, and the replacement must arise in a listed situation. A new deal with the same landlord does not automatically qualify.
- Changes to the area let may matter.
- Rent records must show what would have been due under the old lease.
Key takeaways
- Overlap relief can prevent double counting of rent.
- It applies only to specified replacement-lease situations.
- Lease dates, plans and rent schedules are central.
Technical analysis
For advisers, and for anyone who wants to check the law behind this page. You do not need this section to understand the guidance above.
Legislation
- FA 2003 Schedule 17A para 9 — reducing rent counted for certain replacement leases
Official guidance
The pages below are HMRC’s guidance. Guidance is not law. It sets out how HMRC reads the legislation, and it is not binding on you, on a tribunal or on a court. Where guidance and the legislation differ, the legislation wins. HMRC can also change or withdraw guidance, and it may not cover your facts.
Where this is not settled
- Whether premises are the same or substantially the same can depend on the lease plans and facts.
- The source page does not explain the detailed calculations in its linked examples.
Evidence you would need
This kind of case is decided on the facts of the individual property. These are the records that usually settle it, and the ones an adviser would ask you for.
- The old and new lease documents
- Plans showing the premises covered by each lease
- The surrender, guarantee, court order or tenancy request where relevant
- Rent schedules for both leases and the dates involved
Explore this with an AI
Readers often want to test their own situation. Copy the prompt below into ChatGPT, Claude or Gemini. It hands the model the actual legislation for this page rather than letting it answer from memory, and tells it to be explicit about what is uncertain. What comes back is information, not advice – check it against the links above.
I am researching UK Stamp Duty Land Tax (SDLT), which applies in England and Northern Ireland. MY QUESTION Stamp duty rent overlap relief when you get a new lease [Replace this with your own situation: what you are buying, the price, the dates, who the buyer is, and what you plan to do with the property.] THE LAW THIS TURNS ON - FA 2003 Schedule 17A para 9 - reducing rent counted for certain replacement leases https://www.legislation.gov.uk/ukpga/2003/14/schedule/17A/paragraph/9/2025-11-17 Guidance page from HMRC on this topic (guidance, not law): https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm16005 HOW I WANT YOU TO ANSWER 1. Work from the legislation above. Read it before answering. Guidance from HMRC is its view of the law, not the law, and does not bind a tribunal or a court. 2. Tell me what the rule actually requires, in plain English. 3. Tell me which facts decide the answer, and which facts would change it. 4. Tell me what evidence I would need to support the position. 5. Be explicit about anything unsettled or fact-sensitive. Do not guess. 6. Your training data has a cutoff and SDLT rates and reliefs change at fiscal events. Say so if you are not sure the law is current. POINTS ALREADY KNOWN TO BE UNCERTAIN ON THIS TOPIC - Whether premises are the same or substantially the same can depend on the lease plans and facts. - The source page does not explain the detailed calculations in its linked examples. Do not give me a conclusion you cannot support from the provisions above.
Legislation links show Finance Act 2003 as it stood on 2025-11-17. The law may have changed since, and the rules that apply are those in force on the date of your transaction. The official guidance this page is based on is here.
This page was last updated on 1 September 2026
Useful article? You may find it helpful to read the original guidance here: Stamp duty rent overlap relief when you get a new lease
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