How do you calculate SDLT when there are linked transactions involving both freehold and leasehold interests?

[Luke Bennett]

How do you calculate SDLT when there are linked transactions involving both freehold and leasehold interests?
For example consider the transfer of non-residential properties:
Freehold value – ?100,000
Leasehold value (NBV of rent) – ?80,000
The combined value is ?180,000. Using the rules for freehold would give SDLT at 1% on the whole ?180,000, but the leasehold rules only charge 1% on the excess over ?150,000. How do they interact?

[Patrick Cannon]

No account is taken of the rent when calculating the consideration for the freehold – see para 9(5) Schedule 5 FA 2003. However, the 0% band is not available for the freehold consideration – see para 9(2A).

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