Understanding Chargeable Consideration for Notional Transactions Under Section 75A (1)(c

SDLT section 75A: chargeable consideration for the notional transaction

If section 75A applies to a land transaction scheme, SDLT is charged on a deemed or notional transaction using the larger of two figures: the highest total consideration given by or on behalf of any one person across the scheme transactions, or the highest total consideration received by or on behalf of the original vendor, known as V, or a person connected with V. This includes cash and non-cash value.

• Section 75A is an anti-avoidance rule that can replace a series of land transactions with one notional transaction for SDLT purposes.
• The chargeable consideration is the larger of: what any one person gives across the scheme, or what V and connected persons receive across the scheme.
• Consideration includes money and “money’s worth”, so non-cash assets or value may need to be included.
• You must identify all scheme transactions, trace amounts paid or received directly or on behalf of others, and check whether any recipient is connected with V under section 1122 of the Corporation Tax Act 2010.
• The calculation can be difficult where payments are split between steps, routed through other entities, or where the value given is non-cash.
• Other rules, including incidental transaction and supplementary provisions, may further affect the final SDLT figure.

Scroll down for the full analysis.

SDLT section 75A: how to work out the chargeable consideration for the notional transaction

This page explains one part of the SDLT anti-avoidance rule in section 75A. The specific issue here is how to identify the amount charged to SDLT when HMRC says a series of transactions should instead be treated as a single “notional transaction”. The rule is technical, but the practical question is simple: if section 75A applies, what figure do you use as the consideration for the deemed land transaction?

What this rule is about

Section 75A is aimed at certain arrangements involving land where the tax result is reduced by using a series of transactions rather than a more direct transfer. If the rule applies, the legislation can replace the actual steps with a notional land transaction for SDLT purposes.

Once you reach that point, you still need to calculate the SDLT on that notional transaction. That requires a figure for the chargeable consideration. This page deals with that calculation.

The source material focuses on section 75A(1)(c). It does not explain when section 75A applies in the first place. It assumes that there are “scheme transactions” and that there is a person referred to as V. In section 75A cases, V is the original vendor or transferor in the wider arrangements.

What the official source says

The official material says that the chargeable consideration for the notional transaction is the largest amount, or aggregate amount, of either:

• consideration given by or on behalf of any one person for any of the scheme transactions, or
• consideration received by or on behalf of V, or a person connected with V, for any of the scheme transactions.

So the legislation requires a comparison. You look across the scheme transactions and identify:

• what any one person has given, directly or indirectly, as consideration, and
• what V, or someone connected with V, has received, directly or indirectly, as consideration.

The relevant amount for the notional transaction is the larger of those figures.

The source also makes two further points:

• “Consideration” includes not just money, but also money’s worth. In other words, non-cash value can count.
• Whether a person is connected with V is determined using section 1122 of the Corporation Tax Act 2010.

The manual also notes that other provisions may affect the result, including rules on incidental transactions and supplementary provisions.

What this means in practice

In practice, this is not simply a matter of taking the price stated in one contract. Section 75A looks across the whole scheme.

The first limb asks: what is the largest total amount given by or on behalf of any one person as consideration for the scheme transactions? That means you may need to trace all amounts provided by a particular person, even if split across several steps.

The second limb asks: what is the largest total amount received by or on behalf of V, or a person connected with V, as consideration for the scheme transactions? Again, that may involve several payments or transfers of value across different steps.

You then compare the two sides and use the larger figure as the chargeable consideration for the notional transaction.

This matters because in structured transactions the amount paid by the ultimate acquirer, and the amount extracted by the original vendor side, may not be shown in one place. The anti-avoidance rule is designed to stop the consideration for SDLT being understated by fragmenting the deal.

The reference to “money’s worth” is important. Consideration is not limited to cash. If value is provided in another form, that value may need to be measured and included. The source does not set out valuation rules in detail, but it makes clear that non-cash consideration is part of the exercise.

How to analyse it

A sensible way to approach this issue is:

• Identify all of the scheme transactions that form part of the section 75A arrangements.
• Identify V, being the original vendor side of the arrangements.
• Check whether any recipients are connected with V, using the statutory connected-person rules in section 1122 of the Corporation Tax Act 2010.
• List all consideration given for each scheme transaction, including non-cash value where relevant.
• For each person who gives consideration, calculate the total amount given by or on behalf of that one person across the scheme transactions.
• For V and each person connected with V, calculate the total amount received by or on behalf of them across the scheme transactions.
• Compare the largest figure from the “given” side with the largest figure from the “received” side.
• Use the larger figure as the chargeable consideration for the notional transaction, subject to any further adjustments required by incidental transaction rules or supplementary provisions.

Questions worth asking include:

• Has consideration been split between several contracts or entities?
• Has someone paid on behalf of another person?
• Has value moved in non-cash form?
• Is a payment really for a scheme transaction, or for something outside it?
• Is a recipient connected with V under the statutory test?

Example

This is only an illustration of the calculation method described in the source.

Suppose a set of scheme transactions is said to fall within section 75A. Person A provides £4 million under one transaction and £1 million under another, both as part of the scheme. So the total given by or on behalf of A is £5 million.

Separately, V receives £4.2 million, and a company connected with V receives £600,000 as part of the scheme. So the total received by or on behalf of V or a connected person is £4.8 million.

On these figures, the chargeable consideration for the notional transaction would be £5 million, because that is the larger amount.

If part of the value had been given in assets rather than cash, the money’s worth of those assets would also need to be brought into account.

Why this can be difficult in practice

Several points can be fact-sensitive.

First, the calculation depends on identifying the correct “scheme transactions”. That can be contentious in section 75A cases, because the boundaries of the scheme may affect the amounts included.

Second, the words “by or on behalf of” and “received by or on behalf of” can require close analysis. A payment may be routed through another entity or made for another person’s benefit. That does not necessarily take it outside the calculation.

Third, non-cash consideration may be harder to measure than cash. The source confirms that money’s worth counts, but does not itself resolve every valuation question.

Fourth, connected-person status matters on the receipt side. The source points to the statutory connected-person test, so the answer depends on that legislation rather than on a looser commercial idea of association.

Finally, the source expressly says there are further rules that may affect the consideration for the notional transaction, including incidental transactions and supplementary provisions. So this page gives only one part of the calculation, not the whole of section 75A.

Key takeaways

• If section 75A applies, the chargeable consideration for the deemed transaction is based on the larger of two figures: what any one person gave, or what V and connected persons received.
• Consideration is not limited to cash; money’s worth also counts.
• The result can depend on how the scheme transactions are identified, whether payments were made on someone’s behalf, and whether recipients are connected with V under the statutory test.

This page was last updated on 24 March 2026

Useful article? You may find it helpful to read the original guidance here: Understanding Chargeable Consideration for Notional Transactions Under Section 75A (1)(c

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