Are two property purchases from the same seller linked transactions for SDLT?

Introduction

Buyers often ask whether two property purchases can be treated separately for Stamp Duty Land Tax even if they happen at about the same time. This matters because if the purchases are classed as linked transactions, SDLT is worked out on the combined price rather than on each purchase individually. That can increase the tax bill.

A common situation is where a company buying residential investment property agrees to buy two dwellings from the same seller. Even if the buyer says there was no intention to link the deals, the legal test is not based only on what the buyer intended. The question is whether, viewed objectively, the transactions form part of a single scheme, arrangement or series of transactions.

The Question

A property investor, acting through a company, identified two separate student rental properties in the same city. Both properties suited the company’s investment criteria, and offers were made on both. It then became clear that the two properties were owned by the same seller.

The buyer’s solicitor raised the possibility that the acquisitions might be linked transactions for SDLT purposes. The buyer wanted to know whether it would help to keep a record of the background and negotiations to show that the purchases were not intended to be linked.

Nick’s Explanation

Nick’s view was that the facts created a strong likelihood that the transactions would be treated as linked. He pointed to section 108 of the Finance Act 2003, which says that transactions are linked if they form part of “a single scheme, arrangement or series of transactions” between the same vendor and purchaser, or connected persons.

In anonymised form, his reasoning was:

• the same purchaser was acquiring both properties;
• the same seller was disposing of both properties; and
• the purchases formed part of the buyer’s wider plan to build a portfolio in that local market.

Nick explained that intention on its own is not decisive. Even if the buyer did not set out to create linked transactions, HMRC would look at the objective facts. Where two properties are being bought from the same seller at the same time or in close succession, it is usually very difficult to argue that they are entirely separate.

He also explained that documenting the negotiations, contracts and timing is still sensible. Good records may help show how each purchase arose and may be useful if HMRC asks questions. But records cannot change the legal effect if the transactions are linked on the facts.

Nick also highlighted the SDLT enquiry window under Schedule 10 to the Finance Act 2003. In broad terms, HMRC generally has nine months from the effective date of the transaction to open an enquiry into an SDLT return.

The Law

The main provision is section 108 of the Finance Act 2003. It provides that transactions are linked for SDLT purposes if they form part of a single scheme, arrangement or series of transactions between the same vendor and purchaser, or persons connected with them.

The effect of linked treatment is that SDLT is not calculated by looking at each acquisition in isolation. Instead, the total consideration for all linked transactions is aggregated to determine the rate of tax. The tax is then apportioned across the transactions in accordance with the statutory rules.

Where a company buys residential property, the higher rates for additional dwellings generally apply. The source material refers to a 5% surcharge, and the practical point remains that corporate buyers of residential property must consider the higher rates regime carefully when calculating SDLT.

The enquiry framework is found in Schedule 10 to the Finance Act 2003. HMRC may enquire into an SDLT return within the statutory time limit, generally nine months from the filing date or other relevant trigger under the Schedule. If HMRC concludes that insufficient SDLT was paid, it may raise an assessment, with interest and potentially penalties depending on the circumstances.

Analysis

The linked transactions question is usually approached in stages.

First, identify the parties. If the same buyer acquires more than one property from the same seller, that is an immediate warning sign. The legislation specifically focuses on transactions between the same vendor and purchaser, or connected persons.

Second, look at timing. Transactions that are negotiated and completed around the same time are much more likely to be seen as part of one arrangement or series.

Third, look at the commercial setting. If both purchases fit into a single investment plan, that tends to support linked treatment. It does not matter that each property may have been considered on its own merits. The question is whether the transactions are connected as part of the same overall course of dealing.

Fourth, consider whether there are genuinely separating features. Examples might include different sellers, different markets, a substantial time gap, or evidence that one purchase had no real connection with the other. Even then, the issue is fact-sensitive.

On the anonymised facts here, the indicators of linked treatment are strong:

• same buyer;
• same seller;
• same locality;
• same broad investment objective; and
• purchases progressing at the same time.

That combination makes it difficult to argue that the acquisitions are wholly independent.

Could the buyer keep a written history showing that the transactions were not intended to be linked? Yes, and that is sensible from a record-keeping point of view. But the legal test is objective. A note saying “these were not intended to be linked” does not outweigh facts showing that they formed part of a single arrangement or series of transactions.

In practical terms, records are helpful for evidential purposes, not because they can re-characterise the transactions. They may show, for example, that each property was separately negotiated, separately valued and separately financed. That may be relevant in a marginal case. But where the same buyer is buying two properties from the same seller at the same time, the scope for successfully resisting linked treatment is usually limited.

If the buyer later acquires further property from the same seller, that can create additional SDLT risk and may prompt wider HMRC scrutiny. Timing, filing accuracy and consistency of disclosure all matter.

If any part of the SDLT analysis turns on whether a dwelling was uninhabitable or not suitable for use as a dwelling, readers should note that the condition thresholds are now relatively high following Amarjeet and Tajinder Mudan v The Commissioners for HMRC [2025] EWCA Civ 799. That authority makes it harder to argue that a property falls outside normal residential treatment merely because it requires repair or modernisation.

Outcome

In a case where the same company is buying two residential properties from the same seller in the same place and at the same time, there is a strong chance that HMRC would treat them as linked transactions under section 108 of the Finance Act 2003.

Keeping a good record of the history is still worthwhile, but it is unlikely on its own to displace linked treatment where the objective facts point clearly in that direction.

Practical Steps

If you are considering whether transactions are linked, the sensible next steps are:

• review who the purchaser and seller are in each transaction;
• compare the timing of negotiations, exchange and completion;
• check whether the purchases form part of one wider acquisition strategy or arrangement;
• keep all correspondence, heads of terms, board minutes, valuation evidence and solicitor notes;
• ensure the SDLT returns are prepared on a consistent and fully informed basis;
• consider the effect of the higher rates for residential property bought by a company; and
• take specialist SDLT advice before filing if there is any real doubt.

If you decide to file on the basis that transactions are not linked, the factual and legal basis for that position should be clearly documented at the time. If you decide to treat them as linked, make sure the aggregation and apportionment are done correctly.

Conclusion

For SDLT, linked transactions are judged by the objective facts, not just by what the buyer meant to do. When the same buyer acquires two residential properties from the same seller as part of the same investment expansion, linked treatment is often the safer and more legally robust view.

Legal References Used

• Finance Act 2003, section 108
• Finance Act 2003, Schedule 10
• Amarjeet and Tajinder Mudan v The Commissioners for HMRC [2025] EWCA Civ 799

This page was last updated on 22 March 2026.

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