Leasehold Extension Calculator
Estimate the cost of extending your lease including the premium, marriage value, and any stamp duty (SDLT) payable. Understand your leasehold extension costs before starting the process.
Lease Details
Current market value with existing lease
This is a simplified estimate. The actual lease extension premium is calculated using the Leasehold Reform Act formula. Get a professional RICS valuation for accurate figures.
Extension Cost
Estimated Premium
£750
Marriage Value
£0
Ground Rent Component
£750
Estimated Total Cost
£3,250
Includes premium + legal fees (£2,000) + valuation (£500)
Cost Breakdown
Property Value Analysis
Cost Breakdown
Disclaimer: This tool does not constitute financial advice. We do not recommend taking actions based solely on these results. The calculator makes assumptions and results may be inaccurate due to changes in government policy, interest rates, or personal circumstances. You use this information at your own risk. We can't guarantee to be perfect, so do note you use the information at your own risk and we can't accept liability if things go wrong. For official guidance, visit Gov UK.
Example Premium Estimates
| Property Value | Lease Length | Ground Rent | Marriage Value | Est. Premium |
|---|---|---|---|---|
| £300,000 | 40 years | £250/year | Yes | £95,000 - £115,000 |
| £300,000 | 60 years | £250/year | Yes | £35,000 - £45,000 |
| £300,000 | 75 years | £250/year | Yes | £15,000 - £20,000 |
| £300,000 | 85 years | £250/year | No | £8,000 - £12,000 |
| £300,000 | 95 years | £250/year | No | £5,000 - £8,000 |
* These are indicative estimates only. Actual premiums depend on detailed valuation and negotiations. Professional valuation is essential.
Special Considerations
2-Year Ownership Requirement
You must have owned the leasehold for at least 2 years to qualify for statutory lease extension rights. If you haven't, you can only extend by informal agreement with the freeholder.
Informal vs Formal Process
Informal negotiations can be quicker and cheaper but lack statutory protection. The formal route under the Leasehold Reform Act guarantees your rights but involves strict procedures and timelines.
Ground Rent Reform
The Leasehold and Freehold Reform Act 2024 reduces ground rent to a peppercorn (£0) for new extensions. This can reduce premiums significantly compared to historic calculations. Review lease transactions for full implications.
Building Safety Implications
Buildings with cladding or safety issues may affect your ability to extend or the costs involved. Lenders may refuse to lend, and valuations can be impacted significantly.
Important: Estimates Only - Professional Valuation Required
This calculator provides estimates only based on typical scenarios. Formal valuations can differ significantly due to specific property characteristics, local market conditions, ground rent terms, and negotiation outcomes. Always obtain professional RICS valuation and legal advice before proceeding with a lease extension. Costs can vary by 20-40% from estimates.
Frequently Asked Questions
What is the 80-year threshold for lease extensions?
When a lease drops below 80 years, marriage value becomes payable. Marriage value is the increase in the property value resulting from the lease extension, and the leaseholder must pay 50% of this gain to the freeholder. Extending before the lease falls below 80 years avoids this additional cost.
What is the difference between informal and statutory extensions?
A statutory extension is a legal right for qualifying leaseholders to extend by 90 years at a peppercorn rent with a formula-based premium. An informal extension is negotiated directly with the freeholder and can be for any length. Statutory extensions offer greater protection but require you to have owned the property for at least 2 years.
Do I pay stamp duty on a lease extension?
SDLT may be payable on the premium paid for a lease extension. The nil-rate threshold for lease extension premiums is £125,000, so many extensions fall below this. If the premium exceeds £125,000, standard SDLT rates apply to the excess.
How is the lease extension premium calculated?
The premium comprises three elements: the diminution in value of the freeholder's interest, the freeholder's share of marriage value (if the lease is below 80 years), and compensation for any other loss to the freeholder. A specialist surveyor or valuer is recommended for accurate calculations.
What changes has the Leasehold Reform Act introduced?
Recent leasehold reforms aim to make extensions cheaper and simpler. Key changes include extending the standard lease extension from 90 to 990 years, reforming the marriage value calculation, and capping ground rents. Some provisions are being phased in over time — check current legislation for the latest position.
Emma Richardson, MRICS
Chartered Surveyor & Property Tax Specialist
Emma Richardson is a RICS-qualified Chartered Surveyor with over 12 years of experience in UK property taxation. She founded Stamp Duty Calculator to help buyers understand the complex world of property transaction taxes.