SDLTM15045 | Variation of leases: Reducing the term: Example

L granted a lease to T of non-residential property on 25 September 1999 for a term of 25 years from and including that date. On 1 August 2005, T agrees that the term of the lease will be varied so that it expires on 31 December 2006 and L agrees to pay T £200,000.

This is the acquisition of a major interest by L, the landlord, who should make a land transaction return no later than 30 August 2005 and pay tax of £2,000 (1% of £200,000).