Regulation 2 Price Calculation for Minor Superior Tenancy

(1)

In relation to land in England, the price payable for a minor superior tenancy^f1 in accordance with paragraph 7A(1) of Schedule 1 to the Leasehold Reform Act 1967 is calculated by applying the following formula—

P = £ \frac{R}{Y} - \frac{R}{Y {(1 + Y)}^{n}}

(2)

For the purposes of the formula in paragraph (1)—

P = the price payable for the minor superior tenancy;
R = the profit rent^f2 (in pounds sterling);
Y = the maturity rate, expressed as a decimal fraction, of the “over 30 not over 30.5 year” National Loans Fund interest rate; and

n = the number of years (rounding up any part of a year to a whole year) remaining on the minor superior tenancy at the relevant time.

(3)

In paragraph (2), the maturity rate is the published interest rate at the close of business on the last trading day of the week before the week in which the relevant time falls.

(4)

In this regulation, “the relevant time” has the same meaning as in section 37(1)(d) of the Leasehold Reform Act 1967.

Annotations

Footnotes

f1: “A minor superior tenancy” is defined in paragraph 7A(2) of Schedule 1 to the Leasehold Reform Act 1967.
f2: “Profit rent” is defined in paragraph 7A(3) of Schedule 1 to the Leasehold Reform Act 1967.