Recruiters paying high rent for business premises could be hit by a new tax which came into effect on 1 December 2003.

Stamp Duty Land Tax (SDLT) becomes payable by the tenants once the accumulated rent exceeds £60,000 on the same property, or £150,000 on a commercial property.

The Finance Act charges SDLT on the net present value of rent payable under a lease.

Commercial transactions in designated disadvantaged areas would be entirely exempt from stamp duty, however.

If a lease is in place for more than seven years, tenants will have to complete a Land Transaction Return and register the lease with the Land Registry.

Those who fail to notify the Inland Revenue within 30 days of a liability will have to pay an automatic fine of £100.

The Association of Residential Landlords said it believed the extra administration would be the worst effect of the new rules – as it will mean even more red tape for

small businesses.

The Inland Revenue has launched an education programme to ensure that solicitors, licensed conveyancers and other professional advisers are aware of the changes.

•Leaflets about the tax are available from the Inland Revenue at www.inlandrevenue.gov.uk. The Inland Revenue’s enquiry line for SDLT issues is 0845 603 0135.