Katja Wigham and Aisha Tarar, in our Commercial Property team, outline the changes to SDLT group relief as laid out in the Autumn Budget.
The Autumn Budget 2026 announced a change to Stamp Duty Land Tax (SDLT) group relief and will apply to transactions taking place from 29 October 2026 onwards. The key change will impact groups that transfer property between companies before the sale of the purchasing company.
What is SDLT group relief?
SDLT is a tax charged on the purchases of land and property in England and Northern Ireland. Group relief is a form of tax relief which allows companies within the same corporate group to transfer land or property without incurring an SDLT charge, provided the conditions listed below are met:
- Both the buyer and the seller must be members of the same group at the completion date of the transaction.
- The transfer of the properties must be for commercial purposes.
- If the buyer and the seller cease to be members of the same group within three years of the transaction, the relief may be withdrawn.
What does the current law state?
The SDLT group relief rules are mainly contained in section 62 and Part 1 of Schedule 7 of the Finance Act 2003. It states that group relief is withdrawn if the buyer and the seller are no longer members of the same group within three years of the completion date of the transaction. If the relief is withdrawn, SDLT becomes payable.
However, under the winding-up exception, group relief could be retained even if the buying company left the same corporate group, provided the seller or a company above the seller in the group structure was wound up. HMRC have noted that this exception has been exploited to avoid clawback of SDLT charges by closing down the seller’s company and then proceeding to sell the buyer’s company. This exception has now been amended by the Autumn Budget to overcome any misuse.
What changes have been introduced?
HMRC has published proposals amending the winding-up exception by subjecting it to a control test. It has been revised to state that where a seller’s company or a company above it in the group structure is wound up, a further change in control of the buyer’s company within three years of the completion date of the transaction for which the group relief was claimed, will lead to the relief being payable.
The aim of the new measures:
The new measure seeks to ensure that the SDLT group relief operates as intended by preventing groups of companies from using the winding-up exception to bypass a SDLT charge arising on the transfer of property outside of the group. If you wish to discuss how the changes may affect your business, please contact our Commercial Property team for further advice.
For further information or legal advice, please contact law@blandy.co.uk or call 0118 951 6800.
This article is intended for the use of clients and other interested parties. The information contained in it is believed to be correct at the date of publication, but it is necessarily of a brief and general nature and should not be relied upon as a substitute for specific professional advice.
