When share transfers are ignored for SDLT anti-avoidance rules
Share transfers and section 75A
An initial transfer of existing shares may be ignored when section 75A works out SDLT on a wider land arrangement. The sequence and nature of each step are vital.
- Existing shares and newly issued shares are treated differently in HMRC’s view.
- Pre-transfer administration may be ignored if it concerns only the share transfer.
- Check the full arrangement before relying on the exception.
Scroll down for the full analysis.
Read the original guidance here:
When share transfers are ignored for SDLT anti-avoidance rules
When share transfers are ignored for SDLT anti-avoidance rules
Buying shares in a company that owns land can form part of a wider property arrangement. The order matters.
For stamp duty land tax, section 75A may leave out an early transfer of existing shares from its calculation, but it treats a new issue of shares differently.
What this rule is about
Section 75A is an anti-avoidance rule for some linked arrangements involving land. It can apply when one person gives up a land interest, another ends up with it or an interest derived from it, and the tax on the actual steps is lower than on an assumed direct sale.
That is the test.
When it applies, the law replaces the relevant land steps with that assumed direct sale for SDLT purposes. It then calculates tax by using the largest relevant amount paid or received across the arrangement.
A share payment can therefore seem important. Section 75C(1) provides a narrow exception for an initial transfer of shares or securities.
What the official source says
The legislation ignores a transfer of an existing share or security for section 75A if that transfer would otherwise be the first connected step. HMRC’s manual explains how it applies that wording in practice.
HMRC calls the connected steps “scheme transactions”.
- An initial transfer of existing shares or securities can be ignored.
- HMRC says this can also cover successive share transfers before any other relevant step.
- HMRC applies the same view to transfers of units in a unit trust.
- HMRC says pre-transfer administration can be ignored where it concerns only the share transfer.
- Examples include shareholder approval needed before the shares can move.
- HMRC says the exception does not cover an issue of new shares or securities.
- If another relevant step comes first, HMRC says the share transfer is not ignored.
This distinction matters: section 75C refers to a transfer of shares. HMRC’s manual separates the movement of shares that already exist from the creation of new ones.
What this means in practice
Where the exception applies, section 75A leaves the amount paid for the shares out when it works out the amount for the assumed direct sale, although that exclusion does not determine whether section 75A applies at all.
It affects only one part of the calculation.
The first document signed may look decisive. It is not.
The real question is whether that document is a relevant step in the overall arrangement.
- Map every step, including steps that happen before the land transfer.
- Put those steps in their actual legal and completion order.
- Separate payments for shares from payments for land and other assets.
- Check whether the shares existed before the arrangement.
- Do not assume shareholder approvals change the answer by themselves.
HMRC’s view may help where a genuine share transfer comes first, before every other relevant step in the arrangement. The wider section 75A test still needs checking against the facts.
How to analyse it
Start with the land, not the share certificate. Ask who owned the land interest at the start and who ends up with it.
Then work through the arrangement in date order.
- Identify the person who disposes of the land interest and the person who ends up with it.
- List every connected step, including agreements and non-land steps.
- Check whether section 75A’s conditions are met before considering the share exception.
- Find the first relevant step in the series.
- Decide whether that step transfers existing shares or securities.
- Check whether an earlier step was more than administration for that transfer.
- If section 75C applies, leave the share payment out of the assumed-sale calculation.
- Keep evidence showing what each payment was for.
What is the most important question? Usually, it is this: did an existing share transfer truly come before every other relevant step?
Example
Amir agrees to buy all the existing shares in Dockside Ltd for £1,000,000. Dockside Ltd owns land.
Before the share transfer, the company obtains shareholder approval needed solely to allow that transfer. A later land-related step forms part of the wider arrangement.
Assume section 75A otherwise applies. HMRC’s manual says it can ignore the share transfer if it was the first relevant step.
The £1,000,000 paid for the shares would then be left out when working out the amount for the assumed direct sale.
Now change one fact: before Amir buys the shares, the company grants a land right as part of the arrangement. HMRC says the exclusion will not apply.
Another relevant step came first.
Why this can be difficult in practice
Company and property deals often involve several documents, several completion dates, and payments for different things. Labels can mislead.
Calling a document a share transfer does not show whether it moves existing shares or creates new ones.
This is where people go wrong: HMRC’s view may ignore an early administrative task that concerns only the share transfer, but it may not ignore an earlier commercial or land-related step.
The difference can be decisive.
- A board or shareholder resolution may be only administration, or it may do more.
- A transfer of units needs checking against the unit trust structure.
- A share sale can include value for assets other than land.
- A payment can be made by someone other than the eventual land buyer.
- The legal order of completion may differ from the commercial timetable.
HMRC’s manual is guidance, not law. Its statements on successive transfers and administration go beyond the short wording of section 75C(1), so the documents and the statutory test remain central.
Key takeaways
- An initial transfer of existing shares may be ignored for section 75A.
- Under HMRC’s view, any earlier relevant step can prevent that result.
- Newly issued shares do not receive the same treatment in HMRC’s manual.
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 — when the anti-avoidance rule can apply; the assumed direct sale and amount used
- FA 2003 section 75C — ignoring an initial transfer of shares
- FA 2003 section 101 — treating unit trust rights as shares
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
- Section 75C(1) expressly refers to a transfer that would be first in a series. HMRC’s view on successive earlier share transfers and pre-transfer administration is guidance rather than wording stated expressly in that subsection.
- Whether a document transfers existing shares or instead creates and issues new shares can depend on the company records and transaction documents.
- Whether section 75A applies depends on the full sequence, the parties, what land interest moves, and every amount paid or received.
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 dated step plan for the whole arrangement
- Share transfer forms, stock transfer forms and company registers
- Documents showing whether any new shares or securities were issued
- Unit trust documents where units are involved
- Land contracts, transfers and completion dates
- A record of every payment and other value given or received
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 share transfers are ignored for SDLT anti-avoidance rules [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 - when the anti-avoidance rule can apply https://www.legislation.gov.uk/ukpga/2003/14/section/75A/2025-11-17 - FA 2003 section 75A - the assumed direct sale and amount used https://www.legislation.gov.uk/ukpga/2003/14/section/75A/2025-11-17 - FA 2003 section 75C - ignoring an initial transfer of shares https://www.legislation.gov.uk/ukpga/2003/14/section/75C/2025-11-17 - FA 2003 section 101 - treating unit trust rights as shares https://www.legislation.gov.uk/ukpga/2003/14/section/101/2025-11-17 Guidance page from HMRC on this topic (guidance, not law): https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm09280 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 - Section 75C(1) expressly refers to a transfer that would be first in a series. HMRC's view on successive earlier share transfers and pre-transfer administration is guidance rather than wording stated expressly in that subsection. - Whether a document transfers existing shares or instead creates and issues new shares can depend on the company records and transaction documents. - Whether section 75A applies depends on the full sequence, the parties, what land interest moves, and every amount paid or received. 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 1 September 2026
Useful article? You may find it helpful to read the original guidance here: When share transfers are ignored for SDLT anti-avoidance rules
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