Definitions of Contract and Conveyance Under FA03/S44 Explained

SDLT contracts, conveyances and completion under section 44 FA 2003

Section 44 of the Finance Act 2003 explains how SDLT works where parties first agree a property deal and only later complete it by transfer or lease. The key terms are defined widely: a contract can be any agreement, a conveyance can be any written or electronic instrument including a lease, and completion means the final land transaction is carried out between the same parties and broadly matches what the contract proposed.

• A contract is not limited to a formal signed sale contract; for SDLT it can include any agreement.
• A conveyance includes any written or electronic instrument that puts the deal into effect, including a lease.
• Completion only occurs if the later transaction is between the same parties and is in substantial conformity with the original contract.
• Minor changes may still allow there to be completion, but major differences in the property interest, price or parties can make the position more complex.
• In practice, you need to compare the original agreement with the final document to decide whether section 44 treats the later step as completion of the earlier contract.

Scroll down for the full analysis.

SDLT contracts, conveyances and completion under section 44 FA 2003

This page explains three basic terms used in the SDLT rules on contracts and conveyances: contract, conveyance and completion. These definitions matter because section 44 of Finance Act 2003 decides when a land transaction is treated as taking place where there is first a contract and later a transfer or lease. The official wording is brief, but the practical effect can be important for timing, filing and deciding which document is treated as the chargeable transaction.

What this rule is about

In many property transactions, the parties first enter into a contract and only later complete the deal by transferring the property or granting a lease. SDLT needs rules to determine what counts as the relevant transaction and when it is treated as happening.

The source material gives the meaning of three terms used in that framework:

• a contract
• a conveyance
• completion

These are deliberately broad definitions. They stop the SDLT rules from applying only to formal paper contracts or traditional transfer deeds. They are meant to cover the real legal steps by which land is agreed to be bought, sold, transferred or leased.

What the official source says

The official source states that:

• a contract includes any agreement
• a conveyance includes any instrument, whether in written or electronic form, including a lease
• completion means completion of the land transaction proposed by the contract, between the same parties, in substantial conformity with the contract

These definitions sit within section 44 FA 2003, which deals with contracts and later conveyances.

What this means in practice

The definition of contract is wider than a formal signed sale contract in the usual conveyancing sense. If there is an agreement that amounts to the relevant contract for the land transaction, section 44 may apply even if the arrangement is informal or not labelled a contract in the documents.

The definition of conveyance is also broad. It is not limited to a transfer deed. It includes any instrument in written or electronic form, and it expressly includes a lease. So the later step that completes the transaction may be a transfer, lease or other instrument that actually carries the deal into effect.

The definition of completion is especially important. Completion is not just any later event. It means the land transaction proposed by the contract is actually completed:

• between the same parties, and
• in substantial conformity with the contract

That means you need to compare the contract with what finally happens. If the eventual transfer or lease is effectively the deal that the contract contemplated, section 44 treats that as completion. If the final arrangement is materially different, the analysis may be more complicated.

In practical terms, this matters because SDLT often distinguishes between:

• the stage when parties agree the deal, and
• the stage when the deal is completed by transfer or lease

These definitions help identify whether the later instrument is the completion of the earlier contract, or whether something else has happened.

How to analyse it

When looking at a transaction under section 44, it helps to ask the following questions.

• Is there an agreement that amounts to a contract for the land transaction? Do not focus only on whether it is a formal sale contract.
• What is the later instrument? Is it a transfer, lease or other written or electronic instrument that carries the transaction into effect?
• Are the parties to the later instrument the same as the parties to the contract?
• Does the later instrument complete the transaction proposed by the contract?
• Is the final transaction in substantial conformity with the contract, even if there are minor changes in detail?

The phrase substantial conformity suggests that exact identity is not always required. Minor differences may not prevent completion from occurring. But the more the final transaction departs from the original bargain, the harder it is to say that the contract has been completed in the statutory sense.

This is therefore a comparison exercise. You look at the original agreement, the final instrument, the parties involved and the substance of what was actually carried out.

Example

A buyer and seller agree that the seller will transfer a freehold property to the buyer. Later, a transfer deed is executed and the property is transferred on terms that match the agreement apart from small administrative changes. On these facts, there is a contract, there is a conveyance, and the later transfer is likely to be completion because it is between the same parties and in substantial conformity with the contract.

By contrast, if the original agreement was for one property interest but the final instrument grants a materially different interest, or involves different parties, it may be harder to say that the later step is completion of that contract for section 44 purposes.

Why this can be difficult in practice

The source wording is short, but the phrase substantial conformity can be fact-sensitive. It does not require a perfect match between contract and completion, but it does require more than a loose connection.

Difficulties can arise where:

• the final instrument changes the property interest being acquired
• the consideration changes significantly
• the parties are not the same
• the transaction is restructured before completion
• there are multiple documents and it is unclear which agreement is the relevant contract

The definition of contract as including any agreement is also broad enough to raise questions about what exactly counts as the operative agreement in a complicated transaction. In straightforward conveyancing this may be obvious. In more complex arrangements it may not be.

The manual excerpt gives the definitions, but it does not itself resolve every borderline case. The answer will depend on the actual documents and the substance of the transaction.

Key takeaways

• For section 44 SDLT purposes, a contract is not limited to a formal written sale contract; it includes any agreement.
• A conveyance is defined broadly and includes any written or electronic instrument, including a lease.
• Completion requires the land transaction proposed by the contract to be carried out between the same parties and in substantial conformity with the contract.

This page was last updated on 24 March 2026

Useful article? You may find it helpful to read the original guidance here: Definitions of Contract and Conveyance Under FA03/S44 Explained

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