Guide on Successive Subsales of Multiple Land Plots Under One Contract

SDLT on separate plot subsales under one original contract

HMRC says that where one contract covers several plots and each plot can complete separately, the original purchase may be treated as a separate SDLT transaction for each plot. This can allow the intermediate buyer to claim subsale relief on each onward sale, but only where the separate completions are genuine and not an artificial attempt to reduce SDLT.

• If buyer B agrees to buy several plots from seller A under one contract, and each plot can complete separately, HMRC may treat the contract as separate section 44 transactions for each plot.
• Where B subsells each plot before completion to different buyers, and each A-B and B-C completion happens together for that plot, each onward sale can be treated as a separate qualifying subsale.
• On that basis, B may claim full subsale relief for each plot under Schedule 2A, provided the legal conditions are met and no other rule prevents relief.
• Even if the original contract is split into separate transactions for SDLT purposes, those transactions may still count as linked transactions under section 108.
• This approach is less likely to apply if the arrangement is really one single land transaction, or if the deal has been split up artificially to save SDLT.
• If there is one original contract for one plot with one final completion and only part is subsold before completion, HMRC says the partial subsale rules apply instead.

Scroll down for the full analysis.

SDLT and successive subsales of separate plots under one original contract

This page explains how HMRC says SDLT should work where one buyer agrees to buy several plots under a single contract, then subsells each plot on to different buyers, with each plot completing separately. The point matters because the tax treatment depends on whether the original deal is treated as one land transaction or several, and that affects both linked transactions and subsale relief.

What this rule is about

The source deals with a specific SDLT problem. A buyer, B, signs one contract with a seller, A, covering multiple plots of land. The contract allows each plot to complete separately. Before completion, B enters into separate subsales of those plots to other buyers.

The legal question is how to identify the relevant land transactions for SDLT purposes. In particular:

• is the original A-B contract treated as one transaction or split into separate transactions for each plot as they complete, and
• can B claim subsale relief on each onward sale?

HMRC’s view in this example is that, for these facts, the original contract is treated as separate contracts for the separate plots within section 44 Finance Act 2003. That allows each subsale to be analysed separately under Schedule 2A.

What the official source says

The example starts with one contract from A to B for three plots for a total of £10 million. The contract fixes a final completion date, but it also allows B to complete each plot separately before that date.

B then enters into three separate subsale agreements:

• Plot 1 to C1 for £5 million
• Plot 2 to C2 for £4 million
• Plot 3 to C3 for £1 million

Each plot completes on a different day, with the A-B sale and the B-C sale for that plot completing together on the same day.

HMRC says the A-B contract should be treated as three separate contracts within section 44, one for each plot and its associated completion. That means B is treated as making three separate acquisitions from A, with effective dates on Day 1, Day 2 and Day 3.

HMRC also says those three A-B transactions appear to be linked transactions under section 108.

For the subsales, HMRC says that once section 44 is applied in this way, there are also three separate “original contracts” for Schedule 2A purposes. Each subsale is therefore treated as:

• a separate pre-completion transaction,
• a free-standing transfer, and
• a qualifying subsale.

On that basis, B can claim full relief under paragraph 16(2) of Schedule 2A for each acquisition of Plot 1, Plot 2 and Plot 3, assuming the statutory conditions are met and no other rule blocks the relief.

The source adds two important qualifications:

• the same approach may also apply where the original contract is for a single plot which is later divided into separate parts and then subsold in a similar way; but
• it is unlikely to apply where what is really a single land transaction has been split up artificially or contrived to reduce SDLT.

HMRC also distinguishes this scenario from two others:

• a single plot occupied and paid for in stages, but with one final completion over the whole plot; and
• a single original contract for one plot with one completion, where B subsells only part of the land before completion.

In that second type of case, HMRC says there is one original contract and the partial subsale rules in paragraph 16(3) to (4) apply instead.

What this means in practice

The practical effect is that the structure of the original contract matters a great deal.

If the original A-B contract genuinely allows separate completions of separate plots, and the onward subsales are aligned with those separate completions, HMRC’s example treats each plot as its own transaction for section 44 purposes. That can allow B to claim full subsale relief separately for each plot, rather than having to analyse everything as one single transaction.

This is helpful because subsale relief is designed to prevent SDLT arising twice in a chain where the intermediate buyer does not keep the property but passes it on before completion.

However, HMRC is also signalling a limit. You cannot assume that any deal can be broken into smaller pieces just because the paperwork says so. If the reality is that there is one overall land transaction and the splitting is artificial, HMRC indicates that this treatment is unlikely to be accepted.

The example also shows that separate treatment for section 44 does not stop the transactions being linked under section 108. So even if there are three separate A-B acquisitions, they may still need to be considered together under the linked transaction rules.

How to analyse it

A sensible way to analyse this kind of arrangement is to ask the following questions.

• What exactly does the original A-B contract provide? Does it genuinely allow separate completion of separate plots or parts?
• Are the plots or parts clearly identifiable in the contract or in the way the deal is implemented?
• Does each onward sale by B correspond to a separate plot or part that can complete independently?
• Do the A-B and B-C completions for each plot happen together, so that the onward buyer effectively takes through the chain on completion?
• Is this a case of separate plots or separately completable parts, or is it really one single acquisition with one final completion?
• If only part of the land is subsold under a single original contract with a single completion, are the partial subsale rules the correct regime instead?
• Are the separate transactions linked under section 108?
• Is there anything about the arrangement suggesting that the fragmentation is contrived rather than commercially real?

The key legal distinction is between a genuine series of separately completable transactions and an attempt to recharacterise one transaction as several. The source does not set out a full anti-avoidance test, but it clearly warns that realism matters.

Example

Illustration: A developer agrees to buy a site made up of three freehold titles under one contract. The contract allows title to each plot to be transferred separately before a long-stop date. Before any completion, the developer agrees to sell each plot to a different group company purchaser. Plot 1 completes on Monday, Plot 2 on Wednesday and Plot 3 on Friday, and on each day the transfer from the original seller to the developer and the onward transfer complete together.

On HMRC’s example, the original contract can be treated as three separate A-B transactions for section 44 purposes, each with its own effective date. Each onward sale can then be analysed as a separate qualifying subsale, so that the developer may claim full subsale relief for each plot if the statutory conditions are satisfied.

That is different from a case where the developer has one contract for one site with one final completion over the whole site, but agrees before completion to sell off part only. In that case, the source says the partial subsale rules are the relevant rules instead.

Why this can be difficult in practice

The difficult part is deciding when separate treatment is justified by the real legal and commercial structure, and when it is not.

The source gives a clear example, but real transactions are often less neat. Some contracts describe one overall purchase price, one development site and one commercial bargain, yet also include machinery for phased transfers. In those cases, it may not always be obvious whether section 44 should treat the arrangement as separate contracts for separate plots, or whether there is still only one original contract for the relevant Schedule 2A analysis.

Another area of difficulty is where the original contract is for a single plot that is later divided up. HMRC says the same treatment may be appropriate, but only in a similar factual pattern. That leaves room for judgement about what counts as sufficiently similar.

The warning about contrived splitting is also important. The source does not provide a complete legal test for contrivance. In practice, the more the separate plots, pricing, completion mechanics and onward sales reflect genuine commercial reality, the stronger the case for separate treatment. The more artificial the fragmentation looks, the harder it may be to rely on this example.

Finally, even where B can claim full subsale relief, that does not answer every SDLT question in the chain. The tax position of the onward buyers still follows the normal subsale rules, and the linked transaction rules may still affect the analysis.

Key takeaways

• Where one contract covers several plots and each plot can complete separately, HMRC’s example treats the original contract as separate section 44 transactions for each plot.
• On those facts, each onward sale can be a separate qualifying subsale, allowing B to claim full subsale relief if the statutory conditions are met.
• This does not automatically apply to every phased or split deal, especially where the arrangement is really one single transaction or has been fragmented artificially.

This page was last updated on 24 March 2026

Useful article? You may find it helpful to read the original guidance here: Guide on Successive Subsales of Multiple Land Plots Under One Contract

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