Guidance on Deferring SDLT Payment for Contingent or Uncertain Consideration

When SDLT payment can be deferred for contingent or uncertain consideration

A buyer may ask HMRC to defer part of their Stamp Duty Land Tax payment if some of the purchase price depends on future events or is not yet known in the legal sense, and that amount may become payable more than six months after the transaction’s effective date. This only delays payment of the SDLT on that element; it does not remove the tax, and SDLT must still be paid on any fixed, known or near-term amounts.

• Deferral may be available where consideration is contingent or uncertain under Finance Act 2003 section 51, such as earn-outs or overage linked to future events.
• The future amount must become payable, or may become payable, more than six months after the effective date of the transaction.
• The buyer must apply to the Stamp Office within 30 days of the effective date.
• Deferral does not cover amounts already paid, due within six months, fixed in amount, or already known when the application is made.
• If the amount is simply not yet calculated but can be worked out from existing facts, HMRC says deferral is not available; the buyer should file using a best estimate and amend the return later.
• In mixed-price deals, each part of the consideration must be analysed separately, because some elements may qualify for deferral while others do not.

Scroll down for the full analysis.

When SDLT payment can be deferred for contingent or uncertain consideration

This page explains when a buyer can ask HMRC to defer paying part of the Stamp Duty Land Tax on a land transaction because some of the price is not yet fixed or may only become payable in the future. The rule matters where the purchase price includes earn-outs, overage, deferred sums or other amounts that depend on later events. It does not remove the tax charge. It only affects when some of the SDLT may be paid.

What this rule is about

SDLT is normally reported and paid shortly after the effective date of the transaction. That can be difficult where part of the consideration is contingent or uncertain.

In broad terms:

• Contingent consideration depends on whether a future event happens.
• Uncertain consideration depends on future events so that the amount is not yet known.

The source material refers to the definitions in Finance Act 2003 section 51. It also explains that not every amount that is not yet known counts as “uncertain” for these purposes. That distinction is important, because the right to ask for deferral only applies in some cases.

What the official source says

HMRC says a buyer may apply under Finance Act 2003 section 90 to defer SDLT where all or part of the chargeable consideration:

• is contingent or uncertain within section 51, and
• becomes payable, or may become payable, more than six months after the effective date of the transaction.

The application must be sent to the Stamp Office within 30 days of the effective date of the transaction.

HMRC also makes clear that an application to defer does not suspend the buyer’s obligation to pay SDLT on consideration that:

• has already been paid when the application is made,
• will become payable within six months of the effective date,
• is not contingent, or
• is known at the time the application is made.

The manual adds an important point: if any part of the contingent or uncertain consideration is payable after six months, deferral can also apply to consideration payable before six months.

HMRC then identifies a category where deferral is not available. This is where the amount is “uncertain” only in the sense that it has not yet been worked out, even though it is in principle ascertainable and does not depend on uncertain future events. In that situation, HMRC says the return should be filed using a best estimate of the purchase price. Once the final amount is known, the buyer should amend the return under Schedule 10 paragraph 6. HMRC also notes that the buyer may make a payment on account if they think interest may arise on any SDLT still due.

What this means in practice

The rule is aimed at transactions where part of the price genuinely depends on what happens later. A common pattern is a base price paid on completion, with a further sum only payable if a future event occurs or if a future figure reaches a certain level.

If the statutory conditions are met, the buyer can ask HMRC to postpone paying the SDLT attributable to the contingent or uncertain element. But this is only a deferral of payment. It is not a cancellation of SDLT, and it does not excuse the buyer from paying tax on the parts of the consideration that are already fixed, already paid, or due soon.

The timing condition is central. The future amount must become payable, or may become payable, more than six months after the effective date. If everything is paid or payable within six months, section 90 deferral is not available on the basis set out in this source.

The other practical point is that not every “unknown” amount qualifies. If the amount does not depend on uncertain future events, but is simply not yet calculated, HMRC says deferral cannot be used. In that case the buyer must estimate the final purchase price as best they can, file on that basis, and later amend the return when the final figure is known.

How to analyse it

A sensible way to approach the issue is to ask the following questions.

• What parts of the consideration are fixed now, and what parts depend on later events?
• Does the amount fall within the section 51 concept of contingent or uncertain consideration, or is it merely not yet computed?
• Will the relevant amount become payable, or may it become payable, more than six months after the effective date?
• Has the application to defer been made within 30 days of the effective date?
• What SDLT is still payable immediately because it relates to sums already paid, due within six months, non-contingent amounts, or amounts already known?

This framework matters because the tax treatment differs depending on the answer. There are really two routes:

• If the amount is contingent or uncertain in the statutory sense and the timing condition is met, the buyer may apply for deferral.
• If the amount is not contingent or uncertain in that sense, but is only not yet ascertained, the buyer should use a best estimate and later amend the return.

Example

Illustration: a buyer acquires land for a fixed sum on completion plus a further payment if planning permission is granted within two years. The further payment is not due unless a future event happens, and if it does become due, that would be more than six months after the effective date. On the basis of the HMRC material, this is the kind of case where the buyer may apply within 30 days to defer SDLT on the contingent element. SDLT on the fixed price would still need to be dealt with in the normal way.

By contrast, suppose the contract says the buyer must pay an amount calculated by reference to a figure that already exists in principle, but the figure has not yet been finalised or measured. If the amount is ascertainable and does not depend on uncertain future events, HMRC says deferral is not available. The buyer should file using a best estimate and amend later when the final amount is known.

Why this can be difficult in practice

The difficult point is often classification. It is not always obvious whether a sum is truly contingent or uncertain because of future events, or whether it is simply an amount that can be worked out later from existing facts.

That distinction matters because it changes the compliance route completely. One route is an application to defer payment. The other is filing on a best estimate and then amending the return.

Timing can also cause problems. The application must be made within 30 days of the effective date, which is a short window. A buyer who assumes deferral is available but does not apply in time may lose the opportunity.

There can also be mixed consideration. Some elements may be fixed and payable immediately, while others are contingent and long-dated. The source material makes clear that deferral does not stop SDLT being due on the fixed or known parts. So the analysis often has to be done element by element rather than by looking at the price as a whole.

Key takeaways

• Deferral of SDLT payment may be available where consideration is contingent or uncertain within section 51 and is payable, or may be payable, more than six months after the effective date.
• The application must be made within 30 days of the effective date, and SDLT still has to be paid on amounts already paid, due within six months, fixed, or known.
• If the amount is merely not yet ascertained, rather than dependent on uncertain future events, HMRC says deferral is not available; the return should be filed on a best estimate and amended later.

This page was last updated on 24 March 2026

Useful article? You may find it helpful to read the original guidance here: Guidance on Deferring SDLT Payment for Contingent or Uncertain Consideration

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