When is a company controlled from outside the UK for SDLT?
Company control and non-resident SDLT
A company’s place of registration does not decide this SDLT question. The test looks at who controls it and whether those people are non-resident for the transaction.
- Control can arise through votes, shares, income, assets or practical decision-making power.
- Schedule 9A changes the normal close company rules for this purpose.
- The correct residence test must be used for each relevant participator.
Scroll down for the full analysis.
Read the original guidance here:
When is a company controlled from outside the UK for SDLT?
Control can trigger the non-resident charge. For this part of the test, you must look beyond the company itself to the people behind it, the rights they hold, and the ways in which those rights may operate. Those rights matter.
What this rule is about
The non-UK control test is one step in deciding whether a company is non-resident for an SDLT property transaction. It matters because that status can affect whether the extra stamp duty charge for non-UK buyers applies.
The test borrows rules from corporation tax law. Those rules set out when a company is a close company: broadly, it is a company controlled by a limited group. Schedule 9A changes some of those rules for SDLT.
That is the point people often miss. A company’s registered office, or the country in its name, does not settle the question.
What the official source says
HMRC’s manual says that the company must meet a modified version of the close company test. The test focuses on relevant participators. In plain terms, these are people who are non-resident for this property transaction and who have a role in the company’s ownership or control.
- Start with the close company rules in Chapter 2 of Part 10 of the Corporation Tax Act 2010.
- Read “participator” as “relevant participator” for this SDLT test.
- Read the reference to five or fewer participators as a reference to any number of relevant participators.
- A relevant participator must be non-resident for the transaction.
- A general partner in a limited partnership is normally excluded from that definition.
- The normal rule in Corporation Tax Act 2010 section 444 is changed.
- The quoted company exclusion in section 446 is left out.
- The rules that attribute rights and powers apply, but Schedule 9A paragraph 10 restricts them.
Control can be direct or indirect. HMRC points to several possible routes: control over the company’s affairs, voting power, share capital, income, or assets.
What this means in practice
Someone may control a company through voting arrangements, an option to obtain shares, or rights over its income or assets, including where those rights operate indirectly or through separate agreements. Legal ownership alone is not enough.
Nor does it matter that there may be more than five relevant people. For this SDLT test, any number can be counted if they are relevant participators and together meet the modified control test.
- Check who can direct the company’s decisions in real life.
- Check voting rights, including rights held through another company.
- Check all share classes, not just ordinary shares.
- Check options and other rights to acquire shares or voting power.
- Check rights to dividends, profits, sale proceeds and company assets.
- Work out the residence position of every person who may be relevant.
How to analyse it
Work through the question in order. The key is to identify control first, then ask whether the people with that control are non-resident under the right test.
- Identify the date the property transaction took effect.
- Identify every person with direct or indirect control rights.
- Apply the control routes in Corporation Tax Act 2010 section 450.
- Decide who is a participator under the close company rules.
- Apply Schedule 9A’s changed meaning of relevant participator.
- Apply the correct residence test to each relevant person.
- Consider whether rights must be attributed to another person, subject to paragraph 10.
- Apply the modified close company test to the full facts.
If your solicitor has said the non-resident charge applies, ask which control rights were counted, whose residence was tested, and how the conclusions follow from the facts. Those two points should be clear from the analysis.
Example
Imagine that Northgate Homes Ltd buys a property. Maya and Leon hold voting rights which let them direct the company’s affairs. Both are non-resident for the transaction under the applicable residence test. On those assumed facts, they are relevant participators and the company may meet the non-UK control test.
Now change one fact. If Maya and Leon own shares but have no voting, income, asset or other control rights, their names on the register alone may not answer the question. You must examine what rights they actually have.
Why this can be difficult in practice
Basic Companies House searches can conceal control. The answer can sit in a shareholders’ agreement, an option, a family arrangement or a chain of companies.
Residence needs care too. HMRC’s manual says the appropriate residence test must be used, including any special rules. This page does not set out those separate tests.
- People often confuse company registration with company control.
- Voting rights may differ from the percentage of shares someone owns.
- Rights held indirectly can matter.
- Options or future rights can matter.
- A limited partnership may need separate analysis.
- Attribution rules may change whose rights are counted.
Key takeaways
- Control, not just the company’s address, is central to this test.
- Voting, shares, income and assets can each point to control.
- Check every relevant person’s residence using the right test.
Technical analysis
For advisers, and for anyone who wants to check the law behind this page. You do not need this section to understand the guidance above.
Legislation
- FA 2003 Schedule 9A para 3 — company conditions for non-resident transaction status
- FA 2003 Schedule 9A para 9 — non-UK control test based on close company rules; modified participator rules for non-UK control; meaning of a relevant participator; modified close company control condition; quoted company exclusion removed for this test; limited attribution of rights and powers
- FA 2003 Schedule 9A para 10 — limits on attributing rights and powers
- an Act of 2010 we do not have an identifier for section 439 — basic definition of a close company (no link: an Act of 2010 we do not have an identifier for)
- an Act of 2010 we do not have an identifier for section 444 — company control condition within close company rules (no link: an Act of 2010 we do not have an identifier for)
- an Act of 2010 we do not have an identifier for section 446 — quoted company exclusion from close company rules (no link: an Act of 2010 we do not have an identifier for)
- an Act of 2010 we do not have an identifier for section 450 — ways a person can control a company (no link: an Act of 2010 we do not have an identifier for)
- an Act of 2010 we do not have an identifier for section 451 — attribution of rights and powers between people (no link: an Act of 2010 we do not have an identifier for)
Official guidance
The pages below are HMRC’s guidance. Guidance is not law. It sets out how HMRC reads the legislation, and it is not binding on you, on a tribunal or on a court. Where guidance and the legislation differ, the legislation wins. HMRC can also change or withdraw guidance, and it may not cover your facts.
Where this is not settled
- The supplied statutory library does not contain Schedule 9A or the Corporation Tax Act 2010 provisions needed to verify the current wording directly.
- No transaction date was supplied. The answer can depend on the law in force when the property purchase took effect.
- The source refers to a separate exclusion for some limited partnership cases but does not set out its terms.
Evidence you would need
This kind of case is decided on the facts of the individual property. These are the records that usually settle it, and the ones an adviser would ask you for.
- The company’s register of members and share classes
- Voting agreements, shareholder agreements and options
- Details of rights to income and company assets
- The identity and residence position of each possible participator
- Details of any limited partnership and its general partners
- The effective date of the property transaction
Explore this with an AI
Readers often want to test their own situation. Copy the prompt below into ChatGPT, Claude or Gemini. It hands the model the actual legislation for this page rather than letting it answer from memory, and tells it to be explicit about what is uncertain. What comes back is information, not advice – check it against the links above.
I am researching UK Stamp Duty Land Tax (SDLT), which applies in England and Northern Ireland. MY QUESTION When is a company controlled from outside the UK for SDLT? [Replace this with your own situation: what you are buying, the price, the dates, who the buyer is, and what you plan to do with the property.] THE LAW THIS TURNS ON - FA 2003 Schedule 9A para 3 - company conditions for non-resident transaction status https://www.legislation.gov.uk/ukpga/2003/14/schedule/9A/paragraph/3/2025-11-17 - FA 2003 Schedule 9A para 9 - non-UK control test based on close company rules https://www.legislation.gov.uk/ukpga/2003/14/schedule/9A/paragraph/9/2025-11-17 - FA 2003 Schedule 9A para 9 - modified participator rules for non-UK control https://www.legislation.gov.uk/ukpga/2003/14/schedule/9A/paragraph/9/2025-11-17 - FA 2003 Schedule 9A para 9 - meaning of a relevant participator https://www.legislation.gov.uk/ukpga/2003/14/schedule/9A/paragraph/9/2025-11-17 - FA 2003 Schedule 9A para 9 - modified close company control condition https://www.legislation.gov.uk/ukpga/2003/14/schedule/9A/paragraph/9/2025-11-17 - FA 2003 Schedule 9A para 9 - quoted company exclusion removed for this test https://www.legislation.gov.uk/ukpga/2003/14/schedule/9A/paragraph/9/2025-11-17 - FA 2003 Schedule 9A para 9 - limited attribution of rights and powers https://www.legislation.gov.uk/ukpga/2003/14/schedule/9A/paragraph/9/2025-11-17 - FA 2003 Schedule 9A para 10 - limits on attributing rights and powers https://www.legislation.gov.uk/ukpga/2003/14/schedule/9A/paragraph/10/2025-11-17 - an Act of 2010 we do not have an identifier for section 439 - basic definition of a close company - an Act of 2010 we do not have an identifier for section 444 - company control condition within close company rules - an Act of 2010 we do not have an identifier for section 446 - quoted company exclusion from close company rules - an Act of 2010 we do not have an identifier for section 450 - ways a person can control a company - an Act of 2010 we do not have an identifier for section 451 - attribution of rights and powers between people Guidance page from HMRC on this topic (guidance, not law): https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm09915 HOW I WANT YOU TO ANSWER 1. Work from the legislation above. Read it before answering. Guidance from HMRC is its view of the law, not the law, and does not bind a tribunal or a court. 2. Tell me what the rule actually requires, in plain English. 3. Tell me which facts decide the answer, and which facts would change it. 4. Tell me what evidence I would need to support the position. 5. Be explicit about anything unsettled or fact-sensitive. Do not guess. 6. Your training data has a cutoff and SDLT rates and reliefs change at fiscal events. Say so if you are not sure the law is current. POINTS ALREADY KNOWN TO BE UNCERTAIN ON THIS TOPIC - The supplied statutory library does not contain Schedule 9A or the Corporation Tax Act 2010 provisions needed to verify the current wording directly. - No transaction date was supplied. The answer can depend on the law in force when the property purchase took effect. - The source refers to a separate exclusion for some limited partnership cases but does not set out its terms. Do not give me a conclusion you cannot support from the provisions above.
Legislation links show Finance Act 2003 as it stood on 2025-11-17. The law may have changed since, and the rules that apply are those in force on the date of your transaction. The official guidance this page is based on is here.
This page was last updated on 31 August 2026
Useful article? You may find it helpful to read the original guidance here: When is a company controlled from outside the UK for SDLT?
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