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Stamp Duty Land Tax – linked transactions

When 2 or more property transactions involve the same buyer and seller, they count as ‘linked’ for SDLT. HMRC may count people connected to a buyer or seller as being the same buyer or seller.

If 2 or more transactions are treated as linked then the buyer pays any SDLT due on the total value of all linked transactions. This may mean that they pay a higher rate of SDLT than if the transactions are counted individually.

If all the properties that link are residential, apply the residential property rates to the linked transactions.

Higher rates of SDLT may be charged from 1 April 2016 on purchases of additional residential properties.

If any or all of the properties that link are non-residential, apply the non-residential property rates to the linked transactions.

SDLT transactions that count as linked

HMRC counts transactions as linked if:

  • there’s more than one transaction
  • the transactions are between the same buyer and seller or between people connected with either of them
  • the transactions are part of a single arrangement or scheme or part of a series of transactions

Connected persons

A connected person could be your relative, for example your brother, sister, parent, grandparent, husband, wife or civil partner – or one of their relatives.

If the buyer or seller is a business, a connected person would be a business partner and their relatives. It also includes companies and groups of companies who are connected to the business.

Different kinds of linked transactions

How and when you do a SDLT return depends on the type of linked transaction you have.

Transactions linked as part of a single arrangement

Some transactions are linked because they’re part of the same single arrangement or scheme. It’s the same whether you document them separately or not. If each transaction has a separate contract, and if the sales are part of the same deal, they count as linked for SDLT.

If you sell a residential property in such a way that one person buys the house but their relative buys the garden, the 2 transactions are linked. They’re connected people and they’re buying things from the same seller as part of a single deal.

Because the 2 transactions are linked, calculate the amount of tax due on the total chargeable consideration for all the transactions. Then, apportion this amount between the transactions in proportion to their share of the total chargeable consideration.

Transactions linked as part of a series of transactions

When a sale is followed by one or more related sales, if there’s something to link all the transactions together, they count as linked transactions for SDLT. There’s no limit to the length of time between the transactions.

Notify HMRC and pay SDLT

When you complete transactions you’ll usually need to tell HMRC by filling an SDLT return. With linked transactions you must notify each purchase or transfer within 30 days of the effective date, this is usually the completion date.

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