When a Property Transfer Is Exempt From Stamp Duty
When SDLT exemptions can apply
Some property transfers are exempt from SDLT, including genuine gifts, certain inheritance transfers, separation-related transfers and qualifying estate variations.
- No cash price does not always mean no value has been given.
- Taking over secured debt has special treatment for inherited property.
- An estate variation must meet a two-year deadline.
Scroll down for the full analysis.
Read the original guidance here:
When a property transfer is exempt from stamp duty
You may not have to pay stamp duty land tax, known as SDLT, on every property transfer. A gift, an inheritance transfer or a transfer on divorce may be exempt. The detail matters, though. A payment, a debt or the reason for the transfer can change the answer.
What this rule is about
SDLT applies to many land and property deals in England and Northern Ireland, but Finance Act 2003 lists transactions that fall outside the charge when they meet its stated exemption conditions. Those transactions are exempt. An exempt transaction is outside the SDLT charge.
This page covers a small group of specific exemptions highlighted in HMRC’s manual. They are useful rules, but they are not a general exemption for family transfers.
Ask what each party gives, whether directly or indirectly, why they make the transfer, and which legal arrangement explains it before deciding whether an exemption applies. Labels do not decide it.
What the official source says
HMRC’s manual lists five types of exempt transaction. The legislation sets the conditions. HMRC’s manual is guidance about HMRC’s view; it is not the law itself.
- A property transfer is exempt if nobody gives money or anything else of value for it.
- Qualifying inheritance transfers may be exempt. They must satisfy a person’s entitlement under a will or intestacy.
- An heir may take over a debt secured on the property under that inheritance exemption. They may not give other value.
- A limited exemption applies to certain temporary housing leases granted through arrangements involving a relevant social housing provider and a housing authority.
- Spouses can claim exemption for linked transfers. Divorce, annulment or judicial separation must provide the link.
- Civil partners can claim linked-transfer exemption. Dissolution, annulment or separation must provide the link.
- Beneficiaries can use an exemption when they change the way an estate is shared within two years after the death, provided nobody gives prohibited value as part of that change.
“No payment” means more than no cash price. Lawyers call any money or other value given for the property, whether directly or indirectly and whether paid in cash or through another arrangement, chargeable consideration. That is chargeable consideration.
What this means in practice
A genuine gift can be exempt. For example, a parent may transfer a mortgage-free home to an adult child for nothing. The lack of a price is important, but it is not the only fact to check.
You might think calling a transfer a gift settles it. It does not. If the child agrees to take over a loan, pay money to a sibling, or provide another benefit as part of the deal, there may be value given.
- Read the transfer documents and any separate agreement together.
- Check whether the buyer takes over a mortgage or another secured loan.
- Check whether somebody else pays money as part of the arrangement.
- Do not assume that a transfer between family members is tax-free.
- For a separation transfer, keep the agreement or court order that explains its purpose.
- For an estate variation, record the date of death and the date of the variation.
The social housing rule is especially narrow. It concerns temporary rented accommodation obtained on a short-term basis and provided under the specified housing-authority arrangements. It is not an exemption for an ordinary private tenancy.
How to analyse it
Start with the facts, not the label on the form. A property transfer may fit more than one description, but each exemption has its own conditions.
- Identify the transfer’s purpose: gift, inheritance, separation, estate change or housing arrangement.
- List everything given in return, including cash, debt and non-cash benefits.
- For an inheritance, check that the transfer gives effect to the will or intestacy rules.
- Check whether any debt was secured on the property immediately after the death.
- For divorce or civil partnership breakdown, check the link between the transfer and the separation arrangements.
- For an estate variation, check that it was completed within two years after the death.
- For a housing lease, check the provider, the housing authority arrangement and the lease terms.
If one condition is missing, do not assume another exemption will fill the gap. The exemption has to match the transaction that actually happened.
Example
Amir inherits a house worth £250,000 under his aunt’s will. The house has a £100,000 mortgage secured on it immediately after her death. Amir takes over that mortgage but gives no cash or other benefit for the house. The inheritance exemption can apply because taking over that secured debt is specifically allowed.
Change one fact: Amir also pays £20,000 to another beneficiary so that he can receive the house. He has now given value beyond the secured debt. The full inheritance exemption does not apply on those facts.
Why this can be difficult in practice
The hard part is often finding the whole bargain. A transfer deed may show no price, while a related agreement records a payment or a promise to take over debt.
Relationship breakdown cases can also be unclear. A transfer does not need to be in a final court order in every case. However, it must have the required connection with the breakdown, separation or related agreement.
- A mortgage is often the fact people miss.
- A payment to another family member may still be part of the property arrangement.
- The two-year estate-variation deadline runs from death, not from when probate ends.
- Not every change in an estate distribution meets the no-value condition.
- HMRC’s short manual summary does not replace the detailed statutory tests.
Key takeaways
- A gift is exempt only if no money or other value is given.
- Inheritance, separation and estate transfers have their own strict conditions.
- Check debts, linked payments and documents before treating a transfer as exempt.
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 section 49 — when a land transaction is exempt from SDLT
- FA 2003 Schedule 3 para 1 — exemption where nothing of value is given
- FA 2003 Schedule 3 para 2 — temporary social housing lease exemption conditions
- FA 2003 Schedule 3 para 3 — property transfers connected with marriage breakdown
- FA 2003 Schedule 3 para 3A — inherited property transferred from an estate
- FA 2003 Schedule 3 para 3B — property transfers connected with civil partnership breakdown (provision not found on legislation.gov.uk)
- FA 2003 Schedule 3 para 4 — changes to an estate distribution after death
- FA 2003 Schedule 4 para 1 — what counts as payment or other value given
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
- Whether something of value has been given can depend on the full agreement, linked arrangements and any debt taken over.
- The supplied statutory text is recorded as current only to 17 November 2025. Current primary legislation must be checked for a transaction after that date.
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 transfer deed, contract and any side agreement
- Evidence of every payment, debt assumption or other benefit connected with the transfer
- The will, grant of representation or intestacy documents for an inheritance transfer
- The court order, separation agreement or related documents for a relationship-breakdown transfer
- The date of death and deed of variation for an estate variation
- The housing authority and provider arrangements for a social housing lease
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 a Property Transfer Is Exempt From Stamp Duty [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 section 49 - when a land transaction is exempt from SDLT https://www.legislation.gov.uk/ukpga/2003/14/section/49/2025-11-17 - FA 2003 Schedule 3 para 1 - exemption where nothing of value is given https://www.legislation.gov.uk/ukpga/2003/14/schedule/3/paragraph/1/2025-11-17 - FA 2003 Schedule 3 para 2 - temporary social housing lease exemption conditions https://www.legislation.gov.uk/ukpga/2003/14/schedule/3/paragraph/2/2025-11-17 - FA 2003 Schedule 3 para 3 - property transfers connected with marriage breakdown https://www.legislation.gov.uk/ukpga/2003/14/schedule/3/paragraph/3/2025-11-17 - FA 2003 Schedule 3 para 3A - inherited property transferred from an estate https://www.legislation.gov.uk/ukpga/2003/14/schedule/3/paragraph/3A/2025-11-17 - FA 2003 Schedule 3 para 3B - property transfers connected with civil partnership breakdown https://www.legislation.gov.uk/ukpga/2003/14/schedule/3/paragraph/3B/2025-11-17 - FA 2003 Schedule 3 para 4 - changes to an estate distribution after death https://www.legislation.gov.uk/ukpga/2003/14/schedule/3/paragraph/4/2025-11-17 - FA 2003 Schedule 4 para 1 - what counts as payment or other value given https://www.legislation.gov.uk/ukpga/2003/14/schedule/4/paragraph/1/2025-11-17 Guidance page from HMRC on this topic (guidance, not law): https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm00520 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 - Whether something of value has been given can depend on the full agreement, linked arrangements and any debt taken over. - The supplied statutory text is recorded as current only to 17 November 2025. Current primary legislation must be checked for a transaction after that date. 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 a Property Transfer Is Exempt From Stamp Duty
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