Understanding SDLT: Apportioning Costs Between Land Transactions and Chattels in Property Sales

SDLT and apportioning the purchase price for fixtures, fittings and chattels

When a property is bought, SDLT is usually charged on the price paid for the land and anything that forms part of it. A separate amount can only be left out for genuine moveable items, known as chattels, if the split of the price is just and reasonable. Whether an item is a fixture or a chattel depends mainly on how and why it is attached, and HMRC may check both the classification and the value used.

• Simply listing contents in the contract does not reduce SDLT; the items must genuinely be separate chattels and valued realistically.
• Fixtures stay within the SDLT calculation, while true chattels may be excluded if their share of the price is supported by evidence.
• HMRC generally expects chattels to be valued at open market value at the effective date, taking account of age, condition and depreciation, not original cost.
• Items often treated as chattels include carpets, curtains, blinds, free-standing furniture and some non-integrated white goods.
• Items usually treated as fixtures include fitted kitchen units, integrated ovens, bathroom sanitary ware, central heating systems and alarm systems.
• Clear itemised schedules and evidence are important, as HMRC may open an enquiry if deductions for chattels look overstated or unsupported.

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SDLT and purchase price apportionment for fixtures, fittings and chattels

This page explains when part of the price paid for a property can be treated as payment for moveable items rather than for the land itself. The distinction matters because SDLT is charged on consideration for the land transaction, not on separate consideration for genuine chattels. In practice, the difficult part is working out which items are part of the land and which are not, and whether any value attributed to chattels is genuinely just and reasonable.

What this rule is about

When a property is sold, the agreed price may cover more than the land and buildings. It may also include items such as furniture, carpets, curtains, equipment or machinery. Under Schedule 4 paragraph 4 Finance Act 2003, if a single price is paid partly for a land transaction and partly for something else, the price must be apportioned on a just and reasonable basis.

That means the SDLT position depends on two linked questions:

• Is the item part of the land, or is it a separate chattel?
• If it is a chattel, what part of the total price is properly attributable to it?

The legal distinction is not based simply on whether an item can be physically moved. The starting point is whether it is attached to the property. If it is attached, the analysis then turns on the degree of attachment and, often more importantly, the purpose of that attachment.

What the official source says

HMRC’s manual says that, in most cases, the full consideration will be treated as paid for the land transaction, with no deduction for chattels. But if part of the price is genuinely attributable to chattels, that part is not chargeable to SDLT.

HMRC makes several important points:

• It is not enough to show that there were moveable items in the property at completion.
• The contract should make clear whether contents are included in the sale.
• An apportionment agreed by the parties is not automatically accepted. It must be just and reasonable.
• HMRC’s view is that chattels should be valued at their open market value at the effective date of the transaction, taking account of age, quality and condition.
• For many household items, that open market value will be much lower than their original purchase cost.

HMRC also says it may open an enquiry where a deduction has been made for chattels, both to test the valuation and to check whether the items are truly chattels rather than fixtures.

What this means in practice

The practical effect is that a buyer cannot reduce SDLT simply by listing a number of household or business items in the contract and assigning generous values to them. The law requires a real separation between:

• the price for the land and anything forming part of it, and
• the price for genuinely separate moveable assets.

If an item is a fixture, it is treated as part of the land transaction. Its value stays within the SDLT calculation. If it is a chattel, its value can in principle be excluded, but only to the extent that the amount attributed to it is properly supported.

For ordinary residential transactions, HMRC’s position is that many claimed deductions for “fixtures and fittings” are overstated or unsupported. This is why the evidence matters. A realistic schedule of items and values is more important than labels used in the contract.

The same broad principles also apply to commercial and industrial property, where the sale may include plant, machinery or equipment. In those cases, the fixture/chattel distinction can be especially important because the values involved may be much larger.

How to analyse it

A sensible way to analyse the point is to work through the following questions.

1. What exactly is being sold?

Identify the items said to fall outside the land transaction. A vague reference to “fixtures and fittings” is not enough. You need to know what the items actually are.

2. Is each item attached to the property?

If not attached, it is more likely to be a chattel. If attached, the issue becomes more nuanced.

3. If attached, what is the degree and purpose of attachment?

This is the core legal test referred to by HMRC. An item attached only lightly, and mainly so it can be used more conveniently as an item in its own right, may still be a chattel. An item attached as part of the permanent improvement or functioning of the building is more likely to be a fixture.

4. Is the item one HMRC normally treats as a chattel or not?

HMRC says there is no complete list, because each case depends on its facts. But the manual gives examples.

Items HMRC says will normally be regarded as chattels include:

• carpets, whether fitted or not
• curtains and blinds
• free-standing furniture
• kitchen white goods, unless fully integrated
• electric and gas fires that can be removed by disconnecting them without damage to the property
• light shades

Items HMRC says will not normally be regarded as chattels include:

• fitted kitchen units, cupboards and sinks
• Agas and wall-mounted ovens
• fitted bathroom sanitary ware
• central heating systems
• intruder alarm systems

5. For external items, are they part of the land?

Plants, shrubs and trees growing in the soil are treated as part of the land. That includes faster-growing trees such as Christmas trees. By contrast, annual crops, felled timber, and plants or trees growing in pots are not treated in the same way.

6. Is the value attributed to chattels just and reasonable?

This is a separate question from whether the items are chattels. Even if they are, the valuation must be realistic. HMRC’s stated view is that open market value at the effective date should be used, with depreciation taken into account. Original cost is not the test.

7. Is there proper evidence?

If HMRC checks the return, it may ask for an itemised schedule showing the chattels, their condition and their open market value at the effective date. The manual says HMRC should involve the Valuation Office Agency if it challenges value during an enquiry.

Example

A buyer agrees to purchase a house for a single total price. The house includes fitted kitchen units, an integrated oven, carpets, curtains, a sofa and a free-standing fridge. The parties produce a separate schedule attributing part of the total to the carpets, curtains, sofa and fridge.

On HMRC’s approach, the fitted kitchen units and integrated oven would normally remain part of the land transaction. Their value would stay within SDLT. The carpets, curtains, sofa and free-standing fridge may be capable of separate treatment as chattels, but only if the values attributed to them are genuine and reflect open market value at the effective date, not replacement cost or optimistic second-hand estimates.

Why this can be difficult in practice

The first difficulty is that the law does not provide a simple universal list of fixtures and chattels. HMRC expressly says each case must be considered on its own merits, and that this area of law continues to evolve.

The second difficulty is that attachment alone is not decisive. The purpose of attachment may matter more than the physical method of fixing. Two items that look similar may be treated differently depending on how and why they are installed.

The third difficulty is valuation. Even where an item is clearly a chattel, the amount that can be taken out of the SDLT calculation is only its just and reasonable share of the total price. In many residential transactions, the second-hand market value of household contents is modest. A schedule that appears to strip out inflated amounts is likely to attract scrutiny.

Commercial transactions add another layer of complexity. Plant and machinery may range from lightly fixed equipment to heavy integral systems. HMRC says that equipment easily removed, for example by undoing bolts, is unlikely to be a fixture. But heavy or integral items, or items whose removal would damage the building or land, are likely to be fixtures. HMRC gives escalators, lifts, boilers, furnaces, walk-in refrigerators and restaurant cooking stations as likely fixtures.

There is also a special point about tenant’s fixtures in England and Northern Ireland. HMRC states that they are fixtures, and therefore part of the land, even if the tenant has a right to remove them. The tenant’s right of severance is itself a chargeable interest for SDLT purposes. That means a right to remove items does not necessarily take them outside the land transaction.

Key takeaways

• Only consideration properly attributable to genuine chattels can fall outside SDLT, and any split of the price must be just and reasonable.
• Whether an item is a fixture or a chattel depends on attachment, and especially on the degree and purpose of that attachment.
• HMRC may check both the classification of the items and the values used, and expects realistic open market values at the effective date.

This page was last updated on 24 March 2026

Useful article? You may find it helpful to read the original guidance here: Understanding SDLT: Apportioning Costs Between Land Transactions and Chattels in Property Sales

View all HMRC SDLT Guidance Pages Here