HMRC enquiries into SDLT group relief claims
HMRC checks after group relief
An SDLT5 certificate is not HMRC approval of group relief. HMRC may open an enquiry and check the whole return.
- Group relief depends on detailed company ownership tests.
- HMRC may request transfer documents and supporting evidence.
- The enquiry period depends on when the return or amendment was delivered.
Scroll down for the full analysis.
Read the original guidance here:
HMRC enquiries into SDLT group relief claims
An SDLT5 certificate is not approval of a group relief claim. Even after issuing the certificate, HMRC may check the return and examine the relief, the price, the documents and other entries. It can look wider.
This matters where stamp duty has been removed from a property transfer between companies.
What this rule is about
Group relief applies to certain property transfers within a group. Group status is fixed by the transfer’s key date.
The broad test requires more than a familiar company name or a shared parent. The law considers rights to shares, profits and assets. It also restricts arrangements involving planned changes of control, outside funding, or tax avoidance, even where those arrangements sit alongside rather than within the transfer itself. Those restrictions matter.
HMRC may decide to check a return that contains this relief. An enquiry is its formal process for doing that.
What the official source says
HMRC’s manual says that it will open an enquiry under Schedule 10 when it decides to check a land transaction return containing a group relief claim. Normally, the manual says that this happens within nine months of the filing date.
The legislation provides further detail. Where a return is filed on time, the nine-month period will usually run from its filing date, rather than from any later action on the return. For a late return, it runs from the date of delivery. An amendment may also create a new enquiry period.
- HMRC can examine every part of the return, rather than only the group relief claim.
- HMRC says that it may request the signed transfer and related papers.
- It may request further information supporting the relief claim.
- Its manual draws attention to the tests in Schedule 7 paragraphs 1 and 2.
- Issuing an SDLT5 certificate should not be taken as acceptance of the claim.
- Enquiries take place after certificates, so registration delays are avoided.
What this means in practice
Do not treat the SDLT5 as a tax clearance letter. Its issue may allow registration to move forward. However, HMRC’s manual says that it does not mean HMRC agrees with the relief.
Once HMRC opens an enquiry, it may check the price, transfer documents, other return entries and the group position, rather than considering the relief claim alone. The scope can be broad.
- Keep papers showing who owned each company on the key date.
- Keep documents showing rights to profits and assets, rather than only share percentages.
- Check whether any sale, funding or control arrangements had already been planned.
- Ensure that the return gives a full and consistent account of the transaction.
- Reply with evidence addressing the points that HMRC raises directly.
If the evidence does not support the claim, HMRC’s manual says that it will amend the tax calculation and remove the relief.
Under the legislation, an enquiry ends with a closure notice. That notice must set out HMRC’s conclusions and, where the enquiry requires them, make amendments, or otherwise confirm that none are needed. It closes the enquiry.
How to analyse it
Start with the facts on the effective date. Group status is usually controlled by the effective date.
- Identify the seller and buyer in the property transfer.
- Check that both were companies on the effective date.
- Determine whether one held at least 75% of the other’s shares, profits and assets.
- A parent must meet both 75% tests.
- Review arrangements that could change control, or under which outside parties could provide money to, or receive money from, either company.
- Check that the deal had genuine commercial reasons and did not form part of tax avoidance arrangements, whether planned before or alongside the transfer. Record the evidence.
- Record the return filing date, delivery date and any amendment date.
- Read HMRC’s enquiry notice carefully to identify what it asks for.
Example
North Ltd owns 100% of the shares in South Ltd. It also holds every right to South Ltd’s profits and assets, including the rights that arise if South Ltd is wound up. This satisfies both points.
South Ltd transfers a warehouse to North Ltd and claims group relief. HMRC issues the SDLT5 certificate, so registration is not held up.
Later, HMRC opens an enquiry. It can request the transfer papers and evidence of the group structure. It can also check other parts of the SDLT return.
The certificate does not settle the claim. If the evidence shows that a planned deal would give an outside party control of North Ltd, but not South Ltd, the restriction rules may matter. Those rules may apply.
Why this can be difficult in practice
This is the point that people often miss: a group chart may not show everything. The legal test includes beneficial rights to profits and assets. Agreements outside the articles of association may also matter.
HMRC’s manual gives useful notice of its approach, but it is not the law. The statutory wording comes first, especially where ownership structures or planned transactions are complex.
- Owning 75% of shares alone may not establish every part of the group test.
- A planned future change in control can matter even if it has not yet happened.
- An SDLT5 certificate does not prove that the relief has been accepted.
- An enquiry into group relief can extend to the rest of the tax return.
Key takeaways
- HMRC can check a group relief claim after issuing an SDLT5 certificate.
- The enquiry may cover the whole SDLT return.
- Good evidence of the group relationship and arrangements is essential.
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 7 para 1 — when companies qualify for group relief
- FA 2003 Schedule 7 para 2 — restrictions that can block group relief
- FA 2003 Schedule 10 para 12 — time limit for opening an enquiry
- FA 2003 Schedule 10 para 13 — matters an SDLT enquiry can cover
- FA 2003 Schedule 10 para 23 — how HMRC closes an SDLT enquiry
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 manual does not give a full list of documents HMRC may request in every enquiry.
- Whether group relief is available can depend on detailed ownership rights and arrangements that are not obvious from a basic company chart.
- The source does not establish whether the administrative timing of SDLT5 certificates described in the manual remains the same in every current case.
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 signed transfer or lease and related transaction documents
- A group structure chart at the effective date
- Share registers and documents showing rights to profits and assets
- Documents covering planned sales, funding and control arrangements
- The filed land transaction return, any amendments and the SDLT5 certificate
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 HMRC enquiries into SDLT group relief claims [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 7 para 1 - when companies qualify for group relief https://www.legislation.gov.uk/ukpga/2003/14/schedule/7/paragraph/1/2025-11-17 - FA 2003 Schedule 7 para 2 - restrictions that can block group relief https://www.legislation.gov.uk/ukpga/2003/14/schedule/7/paragraph/2/2025-11-17 - FA 2003 Schedule 10 para 12 - time limit for opening an enquiry https://www.legislation.gov.uk/ukpga/2003/14/schedule/10/paragraph/12/2025-11-17 - FA 2003 Schedule 10 para 13 - matters an SDLT enquiry can cover https://www.legislation.gov.uk/ukpga/2003/14/schedule/10/paragraph/13/2025-11-17 - FA 2003 Schedule 10 para 23 - how HMRC closes an SDLT enquiry https://www.legislation.gov.uk/ukpga/2003/14/schedule/10/paragraph/23/2025-11-17 Guidance page from HMRC on this topic (guidance, not law): https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm23013 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 - The manual does not give a full list of documents HMRC may request in every enquiry. - Whether group relief is available can depend on detailed ownership rights and arrangements that are not obvious from a basic company chart. - The source does not establish whether the administrative timing of SDLT5 certificates described in the manual remains the same in every current case. 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: HMRC enquiries into SDLT group relief claims
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