Stamp duty on lease payments for time before the lease starts
In brief
A lease payment for time before the legal grant date does not count as rent for the SDLT rent calculation.
- Check the legal grant date.
- Check what period the payment covers.
- The archived HMRC page contains no worked example.
Scroll down for the full analysis.
Read the original guidance here:
Stamp duty on lease payments for time before the lease starts
Stamp duty on lease payments for time before the lease starts
To assess a payment described as rent for stamp duty land tax, consider whether it covers time before a lease starts and whether the legal lease has been granted. Timing is important. Use the legal grant date rather than the date you first occupy the property. This archived HMRC page contains no worked facts, as it directs readers to another manual page.
What this rule is about
Parties may start using a lease in practice before its legal grant. They may later make a catch-up payment for that earlier use. Describing the payment as rent does not determine its stamp duty treatment.
What the official source says
HMRC has archived the supplied page. Its only message states that HMRC has moved Example 2 to SDLTM17115. The page does not provide that example’s facts, result or figures.
- The page offers no stand-alone example.
- It directs readers to another HMRC manual page.
- HMRC manuals explain HMRC’s view; they are not law.
At the grant date, the legislation draws a line. Schedule 5 says an amount paid for time before the lease is granted does not count as rent for SDLT, even if the parties call it rent.
That distinction matters. It removes the amount from the special rent calculation, but you must still consider whether the general rules bring that payment into account for the lease.
- The payment must be for the grant of a lease.
- It must relate to time before that grant.
- If both apply, it does not count as rent for Schedule 5.
What this means in practice
This distinction may affect how you consider the payment for stamp duty. If a payment does not meet the rent definition, the general rules for the amount paid for the lease may matter instead.
No rate or full calculation appears in the supplied source.
- Check payments made before the lease was granted.
- Do not rely only on an invoice label.
- Keep the payment terms with the lease papers.
How to analyse it
Begin with the legal grant date, which may differ from the day someone handed over the keys. Then list every payment and the period covered by each payment.
- Find the legal grant date.
- Identify the period each payment covers.
- Compare that period with the grant date.
Example
Illustration: on 30 June, the parties grant a lease. A payment called rent covers 1 to 29 June, so its label alone cannot determine its SDLT treatment.
On those facts, paragraph 1A treats the payment as relating to time before grant, rather than as rent. A payment for time from 30 June requires separate consideration.
Why this can be difficult in practice
This is where people get it wrong: occupation and legal grant can occur on different days. A payment may cover more than one period.
Where it does, the documents must show what the payment is actually for. An invoice label should not decide the answer. Read the terms. The archived source cannot resolve that fact question.
- Occupation may begin before legal grant.
- A single payment may cover different periods.
- The moved example is not reproduced on this page.
Key takeaways
- The grant date matters.
- Pre-grant amounts do not count as rent for Schedule 5.
- The lease papers should explain every payment.
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 5 para 1A — amounts before lease grant excluded from rent
- FA 2003 Schedule 5 para 2 — tax calculation for amounts that count as rent
- FA 2003 section 55 — general calculation subject to special rent rules
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
- The archived page alone cannot show the facts or conclusion in the example now held at SDLTM17115.
- A payment covering time both before and after grant may need careful analysis of the documents and facts.
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 date on which the lease was legally granted
- the lease, agreement and any side letters
- payment demands and invoices showing the period covered
- evidence of when occupation began
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 on lease payments for time before the lease starts [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 5 para 1A - amounts before lease grant excluded from rent https://www.legislation.gov.uk/ukpga/2003/14/schedule/5/paragraph/1A/2025-11-17 - FA 2003 Schedule 5 para 2 - tax calculation for amounts that count as rent https://www.legislation.gov.uk/ukpga/2003/14/schedule/5/paragraph/2/2025-11-17 - FA 2003 section 55 - general calculation subject to special rent rules https://www.legislation.gov.uk/ukpga/2003/14/section/55/2025-11-17 Guidance page from HMRC on this topic (guidance, not law): https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm17120 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 - The archived page alone cannot show the facts or conclusion in the example now held at SDLTM17115. - A payment covering time both before and after grant may need careful analysis of the documents and facts. 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 on lease payments for time before the lease starts
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