How a partnership share is worked out for SDLT
Partnership share for SDLT
For the relevant SDLT partnership rules, a partner’s share means their entitlement to income profits at the relevant time.
- It may differ from a capital share.
- It may change over time.
- Partnership documents and accounts matter.
Scroll down for the full analysis.
Read the original guidance here:
How a partnership share is worked out for SDLT
Under the stamp duty land tax partnership rules, your partnership share is calculated by identifying your share of the partnership’s income profits at the relevant time.
Your capital stake, voting rights or name on a property title do not automatically determine that share.
What this rule is about
Part 3 of Schedule 15 contains special rules for land held in a partnership. Some of those rules require a percentage for each partner.
This definition determines which percentage to use.
What the official source says
The legislation requires the proportion of income profits that a person can receive at that time to be used. HMRC’s internal manual repeats this point.
The manual is guidance; the legislation is the law.
- Use the partner’s entitlement to income profits.
- Use the percentage at the time the rule asks about.
- A later change can produce a different percentage.
- Do not assume a capital percentage is the answer.
What this means in practice
Start with the partnership terms. A person may contribute half the money but have a different entitlement to income profits.
That difference can matter when partners work out a partnership land transaction.
- Check the written partnership agreement.
- Check any agreed change to profit-sharing terms.
- Match the terms to the relevant date.
- Keep accounts and records that support the percentage.
How to analyse it
Ask a simple question: what share of income profits could this person receive on the date that matters?
If the agreement sets one income-profit share and the partners later agree a change, use the changed percentage where the relevant date falls after that change.
Dates control. Work from the documents, not from an informal label such as “equal partner”.
- Identify the transaction and relevant date.
- Find the profit-sharing terms in force then.
- Work out each person’s stated proportion.
- Check whether the terms changed before that date.
Example
Until 30 June, Maya has a right to 60% of income profits. From 1 July, her right is to 30%.
The relevant event occurs on 15 July, after Maya’s income-profit entitlement changed on 1 July. This rule therefore gives her a partnership share of 30%.
Her 50% capital account does not alter it.
Why this can be difficult in practice
Partners often alter their arrangements without updating every document that records them. They may also divide income differently from capital.
The source provides no method for resolving an unclear or disputed agreement.
- Accounts may not match the written agreement.
- An informal change may be hard to date.
- Profit shares and capital shares may differ.
Key takeaways
- The relevant share is the share of income profits.
- Use the percentage at the relevant time.
- Check the agreement and later changes carefully.
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 15 para 34 — defines a partner’s share by income profits
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 source does not explain how to resolve an unclear, disputed or informal agreement about entitlement to income profits.
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 partnership agreement and any later variations
- Accounts showing how income profits were allocated
- Records identifying the relevant date
- Documents showing whether profit-sharing terms changed before that date
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 How a partnership share is worked out 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 15 para 34 - defines a partner's share by income profits https://www.legislation.gov.uk/ukpga/2003/14/schedule/15/paragraph/34/2025-11-17 Guidance page from HMRC on this topic (guidance, not law): https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm33400 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 source does not explain how to resolve an unclear, disputed or informal agreement about entitlement to income profits. 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: How a partnership share is worked out for SDLT
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