Acting for the seller in land option agreements: call/put, option periods, encumbrances, exercise, pricing, tranches and split reversions, VAT and HM Land Registry (England and Wales)

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Call or put option?

In a call option, the purchaser holds the reins, as it may demand transfer of the asset. The seller should recognise that its intentions for the site could be curtailed by that right, and plans for the property restricted. A put option, by contrast, places control with the seller, enabling it to require the purchaser to take the property and complete the acquisition, obliging the buyer to buy.

Option period

For a call option, the vendor should be mindful that the land could be effectively frozen throughout the option window, potentially sterilising its use. Accordingly, the deal ought to state a clear long‑stop date to cap the period. The Perpetuities and Accumulations Act 2009 (PAA 2009) removed the rule against perpetuities for options, so those granted on or after 6 April 2010 do not need a specified long‑stop date in this context. Before PAA 2009, a call option lapsed if not exercised within 21 years.

Where exercise depends on the buyer securing planning permission, ensure any mechanism to extend the option to cover the judicial review period is not indefinite or open‑ended in scope. See Practice Note: Options agreements—land—extending time for exercise...

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Web page updated on 20/05/2026

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