Stamp Duty: Leases

Stamp Duty is payable on any document described as:

  • Lease
  • Tenancy
  • Agreement to Lease
  • Licence (where exclusive possession is granted)

Or any other document which has the effect of granting Leasehold title to a property, being the right to use property for a fixed or defined period of time, other than perpetuity.

Stamp Duty Assessment

A Lease is subject to a Stamp Duty Assessment. The purpose of the Assessment is to establish the amount of ad-valorem Stamp Duty payable. Duty is payable on the Average Annual Rent over the Term (lease length) or the Market Rent, whichever is higher, and the Valuation & Estates Office will undertake a Market Valuation to establish the latter figure.

If, in the opinion of the Valuation & Estates Office, the Market Rent is in excess of the Average Annual Rent then a Stamp Duty Assessment will be issued, outlining the Duty payable. The Assessment provides a window of opportunity for review, as there will on occasion be information affecting the value of which the Valuation & Estates Office is unaware. After that period has elapsed, the Stamp Duty will be assessed based on the Market Rent established by the Valuation Officer.

In the event that the parties to the document continue to disagree with the Assessment issued, they may apply for the Stamp Duty to be adjudicated. By application to the Minister of Finance (and payment of prescribed fees), the assessment of Stamp Duty will be adjudicated as a binding decision (with limited right of appeal thereafter, upon payment).

Stamp Duty Rates

The rate of Duty payable is dependent on the lease term (length). When determining the term (length) of the lease any provisions or options within the lease for extending the lease term must be included.

Note: The calculation for ‘length of lease’ does not include any ‘option(s) to renew’, only to ‘options to extend’.

Rates based Lease Term

Rate Lease Term (Length)
5%Of Average Annual Rent, or Assessed Market Rent, whichever is higher For a lease term of 5 years or less, where no premium is payable
10%Of Average Annual Rent, or Assessed Market Rent, whichever is higher For a lease term of between 5 years and 10 years, where no premium is payable
20%Of Average Annual Rent, or Assessed Market Rent, whichever is higher For a lease term of between 10 years and 30 years, where no premium is payable
As Aboveplus Duty assessed on a Transfer of Land on the value of the Premium For a lease term of 30 years or less, where a premium is payable
Assessed on the Market Value of the Freehold interest at Duty rate for a Transfer of Land For a lease term of over 30 years

Submission Requirements

In submitting a document for Stamp Duty you should enclose the following;

  • Payment, based on the anticipated rate of Duty and the consideration paid. If additional Duty is required you will be advised accordingly.
  • A chattels list, if a deduction for chattels is being made. Further guidance on the completion of a chattels list can be found here.
  • Any waiver letter given from the Minister of Finance in relation to Stamp Duty.
  • The Purchase Agreement (or receipt of Duty payment) if the Transfer document relates to an Agreement on which Stamp Duty was previously paid.
  • Additional information relating to the purchase, in particular where you are aware that the consideration may deviate significantly from a Valuation on the transaction date. Such information may include;
    • The date when the purchase price was agreed
    • Any damage to the property
    • Details of any other property which has been acquired as part of a larger transaction

If further information is required in order to undertake the Stamp Duty Assessment you will be advised accordingly.