When does a company count as non-resident for SDLT?
Company non-residence for SDLT
A company can count as non-resident for the SDLT surcharge in two ways. A UK-resident company can still be caught if it is closely held, under non-UK control and not excluded.
- The effective date matters
- Corporation tax residence is not decisive
- Special rules may apply in some arrangements
Scroll down for the full analysis.
Read the original guidance here:
When does a company count as non-resident for SDLT?
Even where a company is UK resident for corporation tax, it does not avoid the non-resident stamp duty surcharge if the SDLT test treats it as non-resident. Corporation tax residence is not decisive. For this SDLT test, a UK-resident company can still count as non-resident if it is closely held, under non-UK control, and not excluded.
What this rule is about
This rule decides whether a company is treated as non-resident for the SDLT surcharge on a property purchase. It is a separate test from the company’s normal corporation tax residence position.
What date matters? The effective date of the transaction. That is the date on which the legislation tests the company’s position.
What the official source says
For this surcharge, HMRC’s manual explains the two routes through which a company counts as non-resident, while the legislation remains the legal source for the test. The manual gives HMRC’s view.
- A company counts as non-resident if it is not UK resident for corporation tax purposes.
- A UK-resident company may also count as non-resident.
- For that second route, it must be a close company.
- It must meet the non-UK control test for that transaction.
- It must not be an excluded company.
What this means in practice
The second route is the part people can miss. A company may be formed in the UK and pay UK corporation tax, yet still fall within the non-resident SDLT test.
All three conditions in that route must be met. Being a close company alone is not enough.
- Check residence on the effective date, not only when the company was set up.
- Check control as well as the company’s own tax residence.
- Check whether an excluded-company rule changes the answer.
How to analyse it
Where, on the effective date, the company is not UK resident for corporation tax purposes, the manual says that it counts as non-resident for this SDLT purpose. That is the simple route.
Where it is UK resident, however, the second route must be considered in sequence, because each condition has to be tested against the transaction date. Do so in order:
- Fix the effective date of the property transaction.
- Establish the company’s corporation tax residence on that date.
- Ask whether it is a close company.
- Apply the non-UK control test.
- Check whether it is an excluded company.
- Check whether a special rule applies to the type of buyer or finance arrangement.
Example
Imagine Oak Ltd is UK resident for corporation tax when it buys a home. That does not end the SDLT question. If Oak Ltd is also a close company, meets the non-UK control test and is not excluded, it counts as non-resident for this surcharge. If any one of those three further conditions is not met, this particular route does not apply.
Why this can be difficult in practice
Terms including “close company”, “control” and “excluded company” carry specific legal meanings, so their application may depend on statutory definitions and the particular facts at the relevant date. The usual clues are insufficient. Its registered office, name, or the location of one director’s home cannot safely answer the question.
This is also a date-sensitive test. A change in ownership or control near the transaction date may matter.
- UK corporation tax residence does not automatically settle the SDLT result.
- Control may need a careful review of ownership and voting rights.
- Special rules may apply to certain collective investment schemes.
- Alternative property finance arrangements have separate provisions.
Key takeaways
- A UK-resident company can still count as non-resident for this SDLT test.
- The second route needs three conditions, not just one.
- Test the company’s position on the effective date.
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 Schedule 9A para 7 — when a company counts as non-resident
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
- This source does not explain how to work out the non-UK control test.
- This source does not explain which companies are excluded companies.
- The facts and statutory definitions needed to apply those terms must be checked separately.
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.
- The company’s corporation tax residence position on the effective date.
- Whether the company is a close company.
- Who controls the company and where those controllers are based.
- Whether an excluded-company rule or a special scheme rule applies.
- The effective date of the property 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 When does a company count as non-resident for SDLT? [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 Schedule 9A para 7 - when a company counts as non-resident https://www.legislation.gov.uk/ukpga/2003/14/schedule/9A/paragraph/7/2025-11-17 Guidance page from HMRC on this topic (guidance, not law): https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm09900 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 - This source does not explain how to work out the non-UK control test. - This source does not explain which companies are excluded companies. - The facts and statutory definitions needed to apply those terms must be checked separately. 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: When does a company count as non-resident for SDLT?
Search Land Tax Advice with Google
