Section 75A: comparing stamp duty in linked property arrangements
The comparison in brief
Section 75A compares SDLT on connected property steps with SDLT on an assumed direct sale.
- A lower scheme total can meet the third condition.
- An equal or higher scheme total does not.
- Other Section 75A conditions still need checking.
Scroll down for the full analysis.
Read the original guidance here:
Section 75A: comparing stamp duty in linked property arrangements
Section 75A: comparing stamp duty in linked property arrangements
Section 75A can apply when a property moves through several connected steps. The central question is straightforward: does the stamp duty paid on those steps amount to less than the tax on an assumed direct sale from the original owner to the end buyer?
What this rule is about
This rule is designed to prevent avoidance. It compares indirect property routes with direct sales.
That comparison may determine whether additional SDLT is payable. It remains only one element of the broader Section 75A test.
What the official source says
HMRC’s manual says that, after working out the amount for the assumed direct sale and calculating its SDLT, that figure must be compared with the total SDLT otherwise due on every land-related step in the arrangement. The comparison is mandatory.
- First, calculate the SDLT for the assumed direct sale between the original owner and the end buyer.
- Next, add the SDLT otherwise due on all the scheme transactions.
- If the assumed direct sale produces more SDLT, the third condition is met.
- If the totals are equal, the third condition is not met.
- If the scheme total is higher, the third condition is not met.
What this means in practice
A single contract cannot settle the issue. The comparison looks at total tax across the connected property steps.
Where the third condition is not satisfied, Section 75A creates no assumed direct transaction; where it is satisfied, the remaining Section 75A conditions and any exception must still be considered. More checks follow.
- List each connected step, including steps that happen after the buyer gets the property.
- Keep the tax calculation for each land-related step.
- Do not treat a lower price on one step as the answer by itself.
How to analyse it
Begin with the people and property involved. The law refers to the original owner as V and the end buyer as P, although the real facts matter more than the labels.
- Did V dispose of an interest in the property?
- Did P end up with that interest, or one derived from it?
- What connected steps make up the arrangement?
- What is the SDLT total for those steps?
- What SDLT would apply to the assumed direct sale?
- Is the assumed-sale figure strictly greater than the scheme total?
Example
Suppose the SDLT calculations for two connected land steps are £8,000 and £2,000. Their total is £10,000. If the assumed direct sale calculation produces £12,000, that amount exceeds £10,000. The third condition is met on these figures. If the assumed-sale figure were £10,000 instead, it would not be met. This example does not decide the other Section 75A conditions.
Why this can be difficult in practice
The arithmetic is often simple. The questions may not be.
You may assume that only land transfers count. Section 75A can cover wider arrangements.
- A later step may still be relevant to the arrangement.
- Payments may be made by, or received by, different people.
- An equal result fails this particular test; it must be a lower scheme total.
Key takeaways
- Set total SDLT on the connected steps against SDLT on an assumed direct sale.
- The assumed-sale SDLT must be higher for this condition to pass.
- This comparison is only one part of the Section 75A analysis.
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 75A — the tax comparison needed for Section 75A; the assumed direct property transaction where the rule applies; how the amount paid in the assumed sale is set; exceptions where certain reliefs cause the difference
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
- Working out the amount paid for the assumed direct transaction can be difficult where several people give or receive value.
- Whether connected steps form part of the relevant arrangements depends on the facts.
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.
- A list of every step connected with the property sale and purchase
- Documents showing who paid or received money or other value
- The SDLT calculation for each land-related step
- The calculation used for the assumed direct transaction
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 Section 75A: comparing stamp duty in linked property arrangements [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 75A - the tax comparison needed for Section 75A https://www.legislation.gov.uk/ukpga/2003/14/section/75A/2025-11-17 - FA 2003 section 75A - the assumed direct property transaction where the rule applies https://www.legislation.gov.uk/ukpga/2003/14/section/75A/2025-11-17 - FA 2003 section 75A - how the amount paid in the assumed sale is set https://www.legislation.gov.uk/ukpga/2003/14/section/75A/2025-11-17 - FA 2003 section 75A - exceptions where certain reliefs cause the difference https://www.legislation.gov.uk/ukpga/2003/14/section/75A/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/sdltm09230 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 - Working out the amount paid for the assumed direct transaction can be difficult where several people give or receive value. - Whether connected steps form part of the relevant arrangements depends on the facts. 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: Section 75A: comparing stamp duty in linked property arrangements
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