Stamp duty group relief when companies transfer property
SDLT group relief at a glance
A company may claim relief from stamp duty land tax when property moves between companies in the same qualifying group. The group must meet the statutory 75% ownership test when the transfer takes effect.
- Planned changes in control can stop relief from applying.
- A later group change can withdraw relief within three years.
- A further SDLT return is due within 30 days if relief is withdrawn.
Scroll down for the full analysis.
Read the original guidance here:
Stamp duty group relief when companies transfer property
A company that transfers property to another company within its group may not need to pay stamp duty land tax. This is known as SDLT group relief. It can prevent a substantial tax bill, but the companies must satisfy a strict ownership test and later changes to the group can reverse the relief.
What this rule is about
Groups may move a building between companies for a range of reasons. They may be reorganising, raising finance, or separating parts of a business.
Even though the group retains ownership of the property overall, an internal move could produce an SDLT bill without relief. Group relief prevents that outcome when the legal conditions are satisfied.
A familiar company name or common director is not enough. The law focuses on ownership and control.
What the official source says
HMRC’s manual states that a company acquiring property can claim group relief if both the seller and buyer belong to the same group on the effective date. For SDLT, that will usually be the date on which the transfer takes effect.
The legislation sets out a more detailed test. Broadly, one company must be a 75% subsidiary of the other, or both must be 75% subsidiaries of the same third company.
- Both the seller and buyer must be companies, meaning bodies corporate.
- They must be members of the same group on the effective date.
- Ordinary share capital is covered by the 75% test.
- It also covers rights to profits and assets on a winding-up.
- Ownership may be direct or through one or more companies.
- A claim for relief must be made in an SDLT return or an amendment.
- Arrangements for someone else to obtain control of the buyer can block relief.
- Arrangements for the buyer to leave the group can also block it.
- Genuine commercial reasons must support the transfer.
- Tax avoidance must not be a main purpose of the arrangements.
What this means in practice
Where the conditions are met and a claim is made, the internal property transfer is exempt from SDLT. The buyer can choose not to claim relief, but that will usually result in SDLT being paid when it might otherwise not be due.
Relief is not merely a box to tick. Consider future plans as well as the transfer date. A proposed sale of the buyer company may matter before it occurs.
- Check the group structure before documents are signed.
- Check any deal that may change who controls the buyer.
- Keep records showing the share and voting rights.
- Make sure the SDLT return records the relief claim.
- Review the position if the group is reorganised after the transfer.
How to analyse it
Begin with the companies rather than the property. The central question is whether the required group relationship existed when the transfer took effect.
Then consider whether an existing plan could change the buyer’s ownership or take it out of the group. An arrangement may include an understanding, even where it was not legally binding.
- Identify the seller, buyer and property being transferred.
- Fix the effective date for the transfer.
- Draw the ownership chain on that date.
- Test the 75% share, profit and winding-up rights.
- Read agreements, heads of terms and board papers for planned changes.
- Check that the transfer has genuine commercial reasons.
- Make the relief claim in the SDLT return.
- Monitor the buyer’s group position for three years.
- Check who holds the property if the buyer later leaves the group.
Example
North Group Ltd owns 100% of both North Estates Ltd and North Trading Ltd. On 1 June, a warehouse valued at £2 million passes from North Estates Ltd to North Trading Ltd. Both companies are then 75% subsidiaries of the same parent, meeting the basic group test.
North Trading Ltd has no planned sale. The move is a genuine business reorganisation. North Trading Ltd claims group relief in its SDLT return. Because of the relief, no SDLT is due on that transfer.
Now change one fact. Before 1 June, the group had agreed to sell North Trading Ltd to an outside buyer. That proposed change may mean group relief is unavailable. The agreement’s timing and terms matter.
Why this can be difficult in practice
Share percentages do not, by themselves, establish the full 75% test. Different share classes may affect rights to dividends and assets on a company’s winding-up. Those details are often absent from group charts.
The three-year rule also frequently catches people out. Relief may be withdrawn where the buyer leaves the group within three years, or under arrangements made during that period, while it or a linked group company still holds the transferred property.
This does not mean that every later sale produces a tax bill. The legislation contains exceptions. For example, it includes rules where the seller leaves the group. The precise route and timing still require checking.
- A planned sale can matter before the sale completes.
- A non-binding understanding can still be an arrangement.
- The property may be held through another relevant group company.
- Only part of the relief may be withdrawn in some cases.
- The tax after withdrawal is worked out using market value, not necessarily the original price.
- If relief is withdrawn, the buyer must send a further SDLT return within 30 days of the disqualifying event and pay the tax by that date.
Key takeaways
- Group relief can remove SDLT on a transfer between qualifying group companies.
- The group relationship must exist when the transfer takes effect.
- Check planned ownership changes before claiming relief.
- A later group change can withdraw relief within the three-year period.
- HMRC’s manual is guidance; the statutory conditions decide the result.
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 62 — how schedule 7 relief must be claimed
- FA 2003 Schedule 7 para 1 — when companies in the same group qualify
- FA 2003 Schedule 7 para 2 — restrictions and anti-avoidance rules for group relief
- FA 2003 Schedule 7 para 3 — when group relief can be withdrawn later
- FA 2003 section 81 — further return after relief is withdrawn
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
- The result can depend on detailed share rights, profit rights, winding-up rights and arrangements that may not appear in a simple group chart.
- The supplied material cannot confirm the law for an effective date after 17 November 2025.
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 transfer documents and the date the transfer took effect
- A group chart at that date
- Shareholder records and the rights attached to each class of shares
- Details of any planned sale, refinancing, reorganisation or change of control
- Evidence of who still held the property when any group change occurred
- The original SDLT return and relief claim
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 Stamp duty group relief when companies transfer property [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 62 - how schedule 7 relief must be claimed https://www.legislation.gov.uk/ukpga/2003/14/section/62/2025-11-17 - FA 2003 Schedule 7 para 1 - when companies in the same group qualify https://www.legislation.gov.uk/ukpga/2003/14/schedule/7/paragraph/1/2025-11-17 - FA 2003 Schedule 7 para 2 - restrictions and anti-avoidance rules for group relief https://www.legislation.gov.uk/ukpga/2003/14/schedule/7/paragraph/2/2025-11-17 - FA 2003 Schedule 7 para 3 - when group relief can be withdrawn later https://www.legislation.gov.uk/ukpga/2003/14/schedule/7/paragraph/3/2025-11-17 - FA 2003 section 81 - further return after relief is withdrawn https://www.legislation.gov.uk/ukpga/2003/14/section/81/2025-11-17 HMRC's guidance page on this topic (guidance, not law): https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm23010 HOW I WANT YOU TO ANSWER 1. Work from the legislation above. Read it before answering. HMRC guidance is HMRC's 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 - The result can depend on detailed share rights, profit rights, winding-up rights and arrangements that may not appear in a simple group chart. - The supplied material cannot confirm the law for an effective date after 17 November 2025. 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: Stamp duty group relief when companies transfer property
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