SDLT on Linked Transactions

Stamp Duty Land Tax (SDLT) is a significant aspect of property transactions in England and Northern Ireland. The amount payable varies depending on the property’s value and other factors including where reliefs are available. A common area which can catch buyers and tenants out is in relation to linked transactions.

What is a linked transaction?

For SDLT purposes, transactions are linked if “they form part of a single scheme, arrangement or series of transactions between the same vendor and purchaser or, in either case, people connected with them”. If we break this definition down further it allows us to better understand what type of transactions may be caught.

  • ‘Form part of a single scheme, arrangement or series of transactions’

Transactions can be caught by this because they’re part of the same single arrangement or scheme, regardless of whether you document them separately or not. Even if each transaction has separate legal documents, if the transactions are considered part of the overall same deal by HMRC then they will still be treated as linked for Stamp Duty Land Tax purposes.

Similarly, where a sale is followed by one or more related sales, provided there is something to link all the transactions together, they are likely to count as linked transactions for Stamp Duty Land Tax. It is important to note that there’s no limit to the length of time between the transactions.

  • Between the same vendor and purchaser or in either case anyone connected with them’

This definition is deliberately broad so as to catch a wider range of transactions. In the context of SDLT, a “connected person” typically refers to individuals or entities with a close relationship, such as family members, business partners, or companies under common control. For example group companies would be caught, but a company with the same majority shareholders and directors may also be caught.


  • Husband buys plot A and Wife buys plot B both from the same person. SDLT will be payable on the total consideration not the separate purchase prices.
  • Landlord grants lease of 3 different properties all to the same tenant

What is the impact?

Linked transactions can have several impacts on SDLT:

  1. Aggregate Consideration: When transactions are linked, the total consideration or value of all the linked transactions is taken into account for the SDLT calculation. This means that the SDLT payable is based on the combined value of all the linked transactions.
  2. Tax Bands: The SDLT rates are applied to the total consideration, which can often push the transaction into a higher tax band, resulting in a higher SDLT liability compared to if the transactions were treated separately.
  3. Additional Dwelling Surcharge: Linked transactions involving the purchase of additional residential properties can attract an additional 3% SDLT surcharge on top of the standard rates. This surcharge applies if the purchaser already owns another property or is purchasing an additional property and can significantly increase the SDLT liability.
  4. Leases: SDLT on the grant of a new lease is calculated based on the Net Present Value (NPV). Where more than one lease is being granted and the leases are considered to be linked the amount of SDLT payable on each lease is calculated based on apportioning the SDLT that would be paid on the aggregate NPV..

In conclusion, linked transactions significantly impact Stamp Duty Land Tax (SDLT) liabilities, as they necessitate the aggregation of consideration, rents, and premiums. Whether in property purchases or lease agreements, the interconnected nature of these transactions can escalate SDLT charges, often pushing transactions into higher tax bands. Moreover, the potential application of additional SDLT surcharges, such as the 3% surcharge on additional residential properties, further compounds the tax burden. Therefore, thorough assessment and planning are crucial to navigate linked SDLT transactions effectively.

For further information, please contact us to speak to a member of our Real Estate Team.

Martha Pollard
Solicitor, Real Estate
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This reflects the law and market position at the date of publication and is written as a general guide. It does not contain definitive legal advice, which should be sought in relation to a specific matter.

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