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A 999 year headlease over five flats and four lock-up shops in a block is purchased for a premium of £1.25 million and annual rent of £6,000. Two of the flats are subject to 99 year underleases.

The transaction is a relevant transaction for the purposes of the relief as it involves the acquisition of more than one dwelling - i.e. the three untenanted flats. The lease premium is apportioned between the three untenanted flats (£750,000), the two tenanted flats (£100,000) and the four shops (£400,000).

The rate of tax on the premium attributed to the untenanted flats is set by the amount of that premium divided by the number of dwellings. This is £250,000 the tax due in respect of these flats is therefore the tax on £250,000 multiplied by 3.

The higher rates for additional dwellings will not be applicable as the non-residential element of the transaction is not neglible. More information about the higher rates can be found at SDLTM09730.

The non-resident rates of SDLT may apply to the residential element of the transaction if any purchaser is not UK resident. More information about the non-resident rates can be found at SDLTM09860.

The rate of tax on the premium attributed to the tenanted flats and the shops (£500,000) is set by the total premium (£1.25 million). As the transaction involves both residential and non-residential property, the tax is calculated using the non-residential rated in accordance with Table B section 55 Finance Act 2003.

Tax due on the net present value of the rent payable under the lease is calculated in the usual way. Again, the non-resident rates of SDLT may apply if any purchaser is not UK resident.