Stamp duty land tax ― basic rules

By Tolley in association with Grant Thornton's stamp taxes team
  • (Updated for Budget 2020)

The following Corporation Tax guidance note by Tolley in association with Grant Thornton's stamp taxes team provides comprehensive and up to date tax information covering:

  • Stamp duty land tax ― basic rules
  • Acquisition of chargeable interest
  • SDLT rates and thresholds
  • Chargeable consideration
  • Linked transactions
  • Exemptions and reliefs
  • Exchanges
  • Contingent, uncertain or unascertained consideration
  • Partnership transactions
  • Transfer to connected company
  • Trusts
  • Anti-avoidance

Stamp Duty Land Tax (SDLT) is generally payable on the purchase or transfer ofinterests in land and buildings in England, Wales and Northern Ireland where the amount paid is above a certain threshold. In addition, most ofthese land and property transactions must be notified to HMRC on an SDLT return, even if no tax is due. Please refer to the SDLT ― administration guidance note for further commentary on notifiable transactions.

From 1 April 2015, the Land and Buildings Transaction Tax (LBTT) applies to land transactions in Scotland. For details ofLBTT, see Sergeant and Sims on Stamp Taxes AA12–AA22 (SSSD, AA[AA351]–SSSD, AA[AA851]). See also the Revenue Scotland website. 
Scotland Act 2012, ss 28, 29, Sch 3; Land and Buildings Transaction Tax (Scotland) Act 2013

From 1 April 2018, Land Transaction Tax (LTT) applies to land transactions in Wales. For details ofLTT, see SSSD, AA[AA901]–SSSD, AA[AA2101]. See also the Welsh Government website. 
Wales Act 2014, s 15; Land Transaction Tax and Anti-avoidance ofDevolved Taxes (Wales) Act 2017

Whilst the underlying rules applying to LBTT, LTT and SDLT are broadly similar in nature, the taxes are not identical. The rest ofthis guidance note covers the law that applies to transactions in England and Northern Ireland.

Note that following a consultation  in February 2019, an additional 2% SDLT will be levied on purchases ofresidential property in England and Northern Ireland by non-UK resident individuals and non-UK resident non-natural persons. This will apply to acquisitions from 1 April 2021. Transitional rules are expected where contracts are exchanged between 11 March 2020 (Budget day) and 31 March 2021 but the transaction is completed or substantially performed on or after 1 April 2021, in order to deter any attempts to forestall the surcharge. The provisions will be legislated in Finance Bill 2020 and

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