Some land and property transactions are exempt from Stamp Duty Land Tax (SDLT) regardless of their value and therefore don’t need to be notified to HM Revenue & Customs (HMRC) on an SDLT return. These include:
In addition HMRC doesn't have to be notified about the following:
For all other land and property transactions HMRC needs to be notified on an SDLT return.
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Property or land may be given away or the ownership transferred to another person for no 'chargeable consideration'. This means that no money changes hands, and there is no other exchange which has a monetary value, such as a mortgage debt. This type of property transaction is exempt from SDLT and HMRC doesn't need to be notified.
Find out about the chargeable consideration and how it's calculated
In almost all cases, when property is left to another person in a will it's exempt from SDLT and HMRC doesn't need to be notified. This includes property that has outstanding debt on it, for example a mortgage.
It also applies to a transaction which changes the terms of a will (within two years of someone dying) so that a different beneficiary receives a property. Provided the new beneficiary doesn’t make any compensation payment - including the assumption of liability for a mortgage - the transaction is exempt from SDLT and HMRC doesn’t need to be notified. (A corresponding variation in the terms of the will in favour of the original beneficiary doesn’t count as a compensation payment - for example leaving them something else instead of the property. In this case there would still be no need to complete an SDLT return.)
When a couple get divorced or separate - or end their civil partnership - and the parties agree to split their property and land between them, or the property is split under the terms of a court order, it's exempt from SDLT and HMRC doesn't need to be notified.
Find out about SDLT on land and property transfers
Find out more about linked transactions
HMRC doesn't have to be notified about freehold land and property transactions with a total value of less than £40,000. However, remember that the total value includes linked transactions.
Linked transactions - find out more
HMRC doesn't have to be notified about the grant of a residential or non-residential lease where the lease is for seven years or more as long as:
HMRC doesn't have to be notified about the assignment or surrender of a residential or non-residential lease as long as both of the following apply:
HMRC doesn't have to be notified about a residential or non-residential leasehold property transaction in either of the following cases:
This is provided that the chargeable consideration does not include any amount which exceeds the relevant residential or non-residential SDLT threshold.
These amounts include:
To work out the net present value (which is based on the average rent over the life of the lease) you can use the Stamp Taxes online calculator.
Use the Stamp Taxes online calculator
Read about SDLT on leasehold purchases
Find out the SDLT rates and thresholds
Some local authorities lease properties for periods of five years or less and then rent them to people who need housing. These leases are exempt from SDLT and HMRC doesn't need to be notified.
Where there are financial arrangements for property purchase involving transactions with the lending institution that are consequential to the main property transaction (for example, in order to comply with Sharia law), these consequential transactions are exempt from SDLT and don’t need to be notified.
In addition, the interest held by a financial institution as a result of an alternative finance mortgage is an ‘exempt interest’. This means that there is no SDLT charge on dealings in such an interest or an interest derived from it (for example, the issue of or trading in sukuk-backed alternative finance assets) and no requirement for parties to these sorts of transactions to submit SDLT returns.
Find out more about exemptions for alternative property finance
There are numerous transfers of land or property which are below the zero rate threshold and do not represent a major interest. Examples include rights of way, drainage etc. These transactions don’t need to be notified.
For all other property and land transactions an SDLT return needs to be completed. This includes transactions where no SDLT is payable because the transaction value is below the current SDLT threshold, but is £40,000 or more.
The return must be sent to HMRC - along with any payment - no more than 30 days after the transaction is completed. The quickest and easiest way to do this is online - the majority of transactions are now filed this way.
Find out about completing the SDLT return
Read about the basics of Stamp Duty Land Tax
