Stamp Duty Land Tax on Leases: Pre-2015 Scottish Transactions

SDLT and Leases Granted Before SDLT Began

Leases granted before SDLT was introduced can still create tax issues if something happens to them later, such as a variation, extension, assignment, or surrender and regrant. The main point is that you must look at both when the lease was first granted and what legal event is happening now. For Scottish land, SDLT stopped applying from April 2015 and LBTT generally applies instead.

• A lease that started before SDLT does not automatically stay outside SDLT for all later dealings.
• The tax position depends on the later event, for example a variation, extension, assignment, renewal, or surrender and regrant.
• You should check the property’s jurisdiction, the date of the original lease, and which tax regime applied at that time.
• For Scotland, SDLT generally ceased to apply to land transactions from April 2015, when LBTT took over.
• Older leases can span more than one tax regime, so the current transaction may need separate analysis.
• The archived guidance only identifies the issue and does not give full rules for deciding detailed cases.

Scroll down for the full analysis.

SDLT and leases granted before SDLT began

This page is about a very narrow point: how Stamp Duty Land Tax applies to leases that already existed before SDLT was introduced. The source material is brief, but the practical issue matters because older leases can continue to affect later variations, assignments, extensions, or other transactions long after the original grant.

What this rule is about

SDLT did not always exist. It replaced the old stamp duty regime for land transactions. That creates a boundary problem: what happens if a lease was granted before SDLT came into force, but something happens to that lease later?

The source heading identifies this as the issue of “pre-implementation leases”. In other words, leases that were already in existence before the SDLT rules started.

The archived note also records an important territorial change. From April 2015, SDLT stopped applying to land transactions in Scotland. From that point, Scottish land transactions generally fell within Land and Buildings Transaction Tax instead.

What the official source says

The official source does not set out detailed rules on this page. It only establishes the topic and flags that the page is archived. It also states that, from April 2015, SDLT no longer applies to land transactions in Scotland, which are instead subject to LBTT.

So the two reliable points from the source are:

• there is a recognised SDLT category dealing with leases granted before SDLT was implemented; and
• for Scotland, SDLT ceased to apply to land transactions from April 2015, because LBTT took over.

What this means in practice

If you are dealing with an old lease, the first question is not simply “is there a lease?” but “when was the lease originally granted, and what tax regime applied at that time?”

That matters because the tax treatment of a later event may depend on whether you are looking at:

• the original grant of the lease;
• a later variation or extension;
• an assignment of the lease;
• a surrender and regrant; or
• a transaction involving Scottish land after SDLT stopped applying there.

A lease that began before SDLT does not automatically fall outside SDLT for all future purposes. Equally, not every later event involving that lease will necessarily be taxed in the same way as a brand new lease. The legal effect depends on what exactly has happened.

For Scottish property, there is an extra layer. Even if the lease is old, you must consider whether the relevant transaction took place after the move from SDLT to LBTT in April 2015.

How to analyse it

A sensible way to approach a pre-implementation lease is to work through these questions in order:

• What is the land jurisdiction: England, Northern Ireland, Wales, or Scotland?
• When was the lease originally granted?
• What tax regime applied at the time of the original grant?
• What event is happening now: assignment, variation, extension, renewal, surrender, or something else?
• Does the current event amount to a new land transaction for tax purposes, or is it merely a continuation of the existing lease?
• If the land is in Scotland, did the relevant transaction occur after SDLT was replaced there by LBTT?

This framework matters because older leases often sit across more than one tax regime. The original lease may pre-date SDLT, but a later transaction involving that lease may still trigger SDLT, or for Scottish land, LBTT.

Example

Illustration: a tenant holds a lease that was granted before SDLT existed. Years later, the parties agree major changes to the term and rent. The original lease itself may be a pre-implementation lease, but the later agreement may need to be analysed separately to see whether it creates a new taxable land transaction. If the property is in Scotland and the relevant event happens after April 2015, SDLT may no longer be the relevant tax at all.

Why this can be difficult in practice

The source page is only a signpost, not a full explanation. The difficulty in practice is that “old lease” is not a complete answer. Tax outcomes usually depend on the legal character of the later event.

Common areas of uncertainty include:

• whether a change to a lease is merely a variation or is so substantial that it is treated as a new grant;
• whether the relevant date is the date of the original lease or the date of the later transaction;
• which territorial regime applies, especially where Scottish land is involved; and
• how archived SDLT guidance fits with later devolved taxes such as LBTT.

Because this page is archived and very limited, it should be read as identifying the topic rather than resolving those detailed questions by itself.

Key takeaways

• A lease granted before SDLT began can still raise tax questions later if there is a further transaction affecting it.
• For Scottish land, SDLT stopped applying from April 2015 and LBTT became the relevant tax instead.
• The key practical question is not just when the lease started, but what legal event is happening now and under which tax regime it falls.

This page was last updated on 24 March 2026

Useful article? You may find it helpful to read the original guidance here: Stamp Duty Land Tax on Leases: Pre-2015 Scottish Transactions

View all HMRC SDLT Guidance Pages Here