Are you connected to a company for SDLT linked transactions if you are married to its director?

Introduction

People often ask whether they are treated as connected to a company for Stamp Duty Land Tax purposes simply because their spouse or civil partner is involved with that company. This matters most where more than one property is being bought from the same seller, because the SDLT linked transactions rules can combine the purchases and increase the tax due.

The short answer is that marriage or civil partnership can create a connection for tax purposes, even if the other spouse has no shares, no directorship and no formal role in the company. Whether the transactions are actually linked still depends on the facts, but the connected persons rules are important and can bring separate purchases into the same SDLT analysis.

The Question

A buyer asks whether they are automatically connected to a company for SDLT linked transaction purposes if they are married to the company’s director, even though they are not a shareholder and are not themselves a director.

The practical concern is whether one purchase made by an individual and another purchase made by a company connected through a spouse could be treated as linked transactions.

Nick’s Explanation

Nick’s explanation was that spouses and civil partners are treated as connected persons for these purposes, and that this can extend the connection to a company where one spouse is involved with that company.

In anonymised form, his point was:

“Under Section 1122 of the Corporation Tax Act 2010, spouses or civil partners are automatically considered connected persons. This means that even if you are not a director or shareholder in a company, you may still be treated as connected to the company if your spouse is a director or holds shares in it. If your spouse is involved in one transaction and you are involved in another with the same or a related seller, those transactions may be treated as linked.”

That captures the central point: the absence of a direct shareholding or office does not necessarily prevent a connection arising through a spouse or civil partner.

The Law

The SDLT linked transactions rules are found in Finance Act 2003. Broadly, transactions can be linked if they form part of a single scheme, arrangement or series of transactions between the same buyer and seller, or between persons connected with them.

For residential SDLT, linked transactions matter because HMRC may aggregate the consideration for the linked purchases and then apply the SDLT rates to the total, which can produce a higher overall charge.

The meaning of “connected” for these purposes is not left to ordinary language. It is determined by statutory rules. The key provision is:

• Corporation Tax Act 2010, section 1122

Section 1122 includes spouses and civil partners within the connected persons rules. It also contains rules connecting individuals with companies in certain circumstances, including where there is control of the company.

In SDLT, the legislation imports connected persons concepts so that transactions are not kept artificially separate merely because different but connected parties are used.

Analysis

The issue can be broken down into four steps.

First, identify the transactions. If there are two or more property purchases, you need to ask whether they are part of the same overall arrangement or series. If they are entirely unrelated, the linked transactions rules may not apply. If they are coordinated purchases from the same seller, or part of the same plan, the risk is much greater.

Second, identify the parties. If one purchase is made by an individual and another by a company, that does not by itself prevent linkage. The law looks beyond the legal form of the buyers and asks whether the buyers are connected.

Third, apply the connected persons rules. A spouse or civil partner is automatically connected with the other spouse or civil partner. So if one spouse controls a company, or is connected with it under the statutory rules, the other spouse may also be brought within the connected persons framework for the SDLT analysis. In practical terms, you do not need your own shares or directorship for the relationship to matter.

Fourth, decide whether the statutory test for linked transactions is met on the facts. Connection alone does not automatically make all transactions linked in every case. There still needs to be a single scheme, arrangement or series of transactions of the kind described in the legislation. But where connected parties are buying multiple properties from the same seller as part of one overall deal, HMRC is likely to examine the transactions together.

So, if a married couple structures purchases so that one property is bought personally and another is bought by a company associated with the other spouse, that structure does not automatically avoid the linked transactions rules. On the contrary, the connected persons provisions are designed to stop that kind of separation from defeating the SDLT treatment where the transactions are in substance connected.

Outcome

A person can be treated as connected to a company for SDLT linked transaction purposes through their spouse or civil partner, even if they personally have no shares and no directorship.

That does not mean every purchase involving the individual and the company will always be linked. But if the purchases form part of the same scheme, arrangement or series of transactions, the connected persons rules can cause them to be treated as linked.

Practical Steps

If you are assessing your own position, work through the following points:

• List every purchase involved, including who is buying each property.
• Check whether the purchases are from the same seller or connected sellers.
• Ask whether the purchases were negotiated together or are part of one wider plan.
• Identify any family or company connections, especially spouses, civil partners, shareholdings, directorships and control.
• Review whether any company involved is controlled by your spouse or civil partner.
• Consider the SDLT effect if the purchases are aggregated as linked transactions.

Because SDLT outcomes can turn on detailed facts, the safest approach is to analyse the whole arrangement rather than looking only at the legal ownership of one buyer in isolation.

Conclusion

For SDLT linked transactions, being married to a company director or shareholder can be enough to bring you within the connected persons rules, even if you have no formal role in the company yourself. If the purchases are part of the same overall arrangement, separating them between an individual and a spouse’s company may not prevent them from being linked.

Legal References Used

• Finance Act 2003, linked transactions provisions
• Corporation Tax Act 2010, section 1122

This page was last updated on 22 March 2026.

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