Guidance on Completing SDLT Forms for Business Sale Transactions

Completing SDLT4 Question 1 for a Business Sale Including Land

When land or buildings are sold as part of a wider business sale, SDLT only applies to the part of the price that relates to the land transaction. Question 1 on SDLT4 asks you to identify any non-chargeable assets included in the deal, such as stock, goodwill, chattels and moveables, or other assets, and to state the total amount of consideration allocated to them on a just and reasonable basis.

• Use question 1 only where the land transfer forms part of the sale of a business or part of a business that also includes non-land assets.
• Relevant non-chargeable categories are stock, goodwill, chattels and moveables, and other assets that are not interests in land.
• Do not assume that all goodwill or all items called “fixtures and fittings” are outside SDLT, as fixtures and some goodwill may legally form part of the land consideration.
• The total price must be apportioned between chargeable land elements and non-chargeable assets on a just and reasonable basis that can be supported by the facts and documents.
• If you select any non-chargeable asset category, you must also enter the total amount allocated to those assets, unless they were transferred for no consideration, in which case the amount box should be left blank.

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How to complete SDLT4 question 1 when a land transaction is part of a business sale

This page explains what HMRC is asking for in question 1 of form SDLT4, used where a land transaction forms part of the sale of a business or part of a business. The point matters because SDLT only applies to chargeable consideration for land transactions. If the overall deal includes both land and non-land assets, the consideration must be split properly.

What this rule is about

Sometimes a business sale includes several types of asset in one package. The buyer may acquire land or buildings, but also stock, goodwill, moveable items, or other business assets. SDLT is concerned with the chargeable consideration for the land transaction, not with amounts properly attributable to assets that do not fall within SDLT.

Question 1 on SDLT4 asks you to identify the non-chargeable assets included in the wider business sale and to state the total amount of consideration allocated to them. Its purpose is to show how the overall price has been divided between chargeable and non-chargeable elements.

What the official source says

HMRC says this question should be completed where an interest in land is transferred as part of the sale of a business, together with other assets that do not attract SDLT. The form asks you to mark the relevant categories of non-chargeable assets:

• stock
• goodwill
• chattels and moveables
• other

The guidance gives examples of stock in a manufacturing context, including raw materials, work in progress, and finished items.

For goodwill, HMRC draws an important distinction. If a payment is for goodwill that is part of the land, that amount is part of the chargeable consideration for SDLT and should be included in the SDLT1 consideration figure. So not everything described commercially as goodwill is automatically outside SDLT.

For chattels and moveables, HMRC again makes an important distinction. Items described in practice as “fixtures and fittings” may include assets that are legally part of the land. If a payment is for fixtures, that payment forms part of the chargeable consideration for SDLT and should be included in the SDLT1 consideration figure.

The “other” category is for anything included in the deal that is not an interest in land and does not fit within stock, goodwill, or chattels and moveables.

If you complete the first part of the question by selecting any category, you must also complete the second part showing the total consideration apportioned to the non-chargeable assets. HMRC says the apportionment must be made on a just and reasonable basis. If the non-chargeable assets were transferred for no consideration, the amount box should be left blank rather than showing zero.

What this means in practice

The practical issue is not just identifying what was sold. It is deciding which parts of the price relate to land for SDLT purposes and which parts relate to assets outside SDLT.

This is especially important in business sales because the contract may use broad commercial labels that do not match the legal analysis. For SDLT, the key question is not how the parties casually describe an asset, but whether it is legally part of the land transaction or genuinely separate from it.

In practice, this means:

• stock is generally a separate non-chargeable asset category
• moveable items may be non-chargeable, but fixtures are treated as part of the land
• goodwill may be non-chargeable, unless what is being paid for is goodwill that is part of the land
• the total price must be apportioned between chargeable and non-chargeable elements on a just and reasonable basis

If too much of the price is allocated to non-chargeable assets without proper support, the SDLT return may understate the chargeable consideration. If too little is allocated, SDLT may be overpaid.

How to analyse it

A sensible way to approach the question is as follows.

1. Identify whether the land transfer is part of a wider business sale. If it is only a land transaction, this question may not be relevant.
2. List all assets included in the deal, not just those mentioned in the property transfer document.
3. Separate the assets into land interests and non-land assets.
4. Check whether any item described as a fitting, fixture, or goodwill is in law actually part of the land transaction.
5. Allocate the consideration between the categories on a just and reasonable basis.
6. Enter the relevant non-chargeable asset categories on SDLT4.
7. Show the total consideration apportioned to those non-chargeable assets, unless they were transferred for nil consideration, in which case leave that part blank.

Questions worth asking include:

• Is the contract price split between asset classes, and if so, is that split supportable?
• Are any “fixtures and fittings” actually fixtures in law rather than moveable chattels?
• Is any amount said to be goodwill really attributable to the land element?
• Does the apportionment reflect the real substance of the transaction?

Example

A company buys a small hotel business. The deal includes the freehold building, trading stock, loose furniture, and some business goodwill. The parties agree a single overall price.

For SDLT, the buyer cannot simply treat everything other than the bare building as outside the tax. Amounts attributable to the freehold are chargeable. Amounts attributable to stock may be non-chargeable. Loose furniture may be non-chargeable if it is genuinely moveable, but items that are fixtures form part of the land consideration. If any goodwill is in substance part of the land, that amount must also be included in the SDLT consideration.

The buyer should select the relevant non-chargeable asset categories on SDLT4 and enter the total amount apportioned to those non-chargeable assets, using a just and reasonable apportionment.

Why this can be difficult in practice

The main difficulty is classification. Commercial documents often group assets together in ways that are convenient for the deal but not precise enough for SDLT. In particular, the boundary between fixtures and moveable items can be fact-sensitive. The same is true of goodwill, because HMRC’s guidance makes clear that some payments described as goodwill may still be part of the land consideration.

The other difficulty is apportionment. HMRC does not prescribe a single method in this page. It says only that the split must be just and reasonable. That leaves room for judgement, but not for arbitrary allocations. The figures should be capable of being explained and supported by the transaction documents and the facts.

Key takeaways

• If a land transfer is part of a business sale, SDLT applies only to the chargeable consideration for the land element, not automatically to the whole package price.
• Do not assume that all goodwill or all “fixtures and fittings” are outside SDLT; some amounts in those categories may still be part of the land consideration.
• Any split of the price between land and non-chargeable assets must be made on a just and reasonable basis and reflected correctly in SDLT4.

This page was last updated on 24 March 2026

Useful article? You may find it helpful to read the original guidance here: Guidance on Completing SDLT Forms for Business Sale Transactions

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