Please re-lease me

We are increasingly coming across renewal of leases and in accordance with normal practice we have claimed the professional fees as allowable although it is noted that HMRC manuals refer to ‘de minimis’ amounts.

Part of the cost of the renewal of a lease is the stamp duty land tax on the lease. This can be quite substantial but why should the tax treatment not follow that of the professional fees and be deductible in the year in which incurred?

Has this subject been discussed with HMRC because I think this must be an issue for future renewals.

Advice from Taxation readers on this subject would be very welcome.

Query 17 572 – Tom

Reply from Marilyn Merlot

Stamp duty land tax payable on a lease renewal forms part of the incidental costs of the acquisition of the new lease and as the lease is...