What is the difference between SDRT and SDLT?

SDRT (Stamp Duty Reserve Tax) applies to electronic share and securities transfers at 0.5%. SDLT (Stamp Duty Land Tax) applies to property and land purchases with tiered rates starting at 0% and rising to 12%. They are completely separate taxes on different types of assets.

Do I pay SDRT when buying shares through a broker?

Yes, when you buy UK shares electronically through a broker, SDRT at 0.5% is automatically charged and collected. Your broker includes this in the settlement process, so you don't need to file a separate return.

Are there exemptions from SDRT?

Yes. UK government gilts (bonds) are exempt. AIM shares are exempt: since 28 April 2014, section 99(4B) FA 1986 has excluded securities admitted to trading on a recognised growth market, and not listed on any market, from the definition of chargeable securities, so they escape both the 0.5% and 1.5% charges. Purchases before that date were chargeable. Shares traded on certain overseas exchanges may be exempt. Gifts of shares do not incur SDRT if no money changes hands.

What is the difference between SDRT and stamp duty on shares?

SDRT applies to electronic share transfers and is charged at 0.5%. Stamp duty on physical share certificates is also 0.5% but is charged when you receive a paper stock transfer form. Most modern share trading is electronic and therefore subject to SDRT.

How is SDRT collected?

For electronic trades through CREST (the UK settlement system), SDRT is automatically calculated and collected by your broker or platform. You see the 0.5% charge added to your purchase cost. There's no separate tax return to file for SDRT.

Stamp Duty Reserve Tax (SDRT) Guide 2026

What is Stamp Duty Reserve Tax

Stamp Duty Reserve Tax (SDRT) is a tax on the electronic purchase of shares and certain securities. It was introduced in 1986 to modernize the stamp duty regime for paperless share trading.

Key Point:

SDRT is charged at 0.5% of the purchase price when you buy UK shares electronically. It's automatically collected by your broker or trading platform.

Despite the similar name, SDRT is completely separate from Stamp Duty Land Tax (SDLT), which applies to property purchases, including commercial property. Use our stamp duty calculator for property transactions, not SDRT.

Who Pays SDRT?

Anyone buying UK shares electronically
Institutional investors purchasing securities
Retail investors using online brokers
Buyers of exchange-traded funds (ETFs) containing UK shares

SDRT vs SDLT vs Stamp Duty on Shares

The "stamp duty" family includes three different taxes that are often confused:

1. Stamp Duty Reserve Tax (SDRT)

What: Tax on electronic share purchases
Rate: 0.5% of purchase price
When: Automatic on paperless share trades
Collection: By broker via CREST system

2. Stamp Duty on Shares

What: Tax on physical share certificate transfers
Rate: 0.5% of purchase price (rounded up to nearest £5)
When: When you receive a paper stock transfer form
Collection: You pay within 30 days via HMRC Stamp Office

3. Stamp Duty Land Tax (SDLT)

What: Tax on property and land purchases
Rate: 0% to 12% in tiered bands
When: Buying residential or commercial property in England/NI
Collection: Solicitor files return and pays within 14 days

Important Distinction:

This website focuses on SDLT (property tax). SDRT is an entirely different tax. You cannot use an SDLT calculator for share purchases, as the 0.5% SDRT rate is fixed regardless of purchase amount. Learn more about stamp duty rate history for property taxes.

The 0.5% Rate on Shares

SDRT is charged at a flat rate of 0.5% of the transaction value. Unlike SDLT, there are no bands or thresholds: the 0.5% applies to the entire purchase amount. For comparison, see current SDLT rates which use tiered bands.

Calculation Examples

Example 1: Small Purchase

Buy £1,000 of shares

SDRT: £1,000 × 0.5% = £5.00

Example 2: Medium Purchase

Buy £10,000 of shares

SDRT: £10,000 × 0.5% = £50.00

Example 3: Large Purchase

Buy £100,000 of shares

SDRT: £100,000 × 0.5% = £500.00

Key Features

No rounding (calculated to exact pence)
Charged on gross transaction value (before fees/commission)
No minimum or maximum thresholds
Cannot be avoided on standard UK share purchases

When SDRT Applies

SDRT is triggered when you purchase shares or securities electronically, including:

Transactions Subject to SDRT

UK company shares listed on the London Stock Exchange
Foreign company shares that maintain a UK share register
Rights to shares (e.g., options to acquire shares)
Units in UK unit trusts
Some ETFs depending on structure and underlying assets

Timing

SDRT becomes due on the date you agree to purchase the shares, not when settlement occurs. However, the tax is typically collected during the settlement process (usually T+2, meaning two business days after the trade).

Typical Timeline

Day 1 (Trade date): You buy shares via broker

Day 1: SDRT liability is created

Day 3 (Settlement date): Shares delivered, payment made, SDRT collected

Exemptions from SDRT

Several types of transactions are exempt from SDRT:

Full Exemptions

UK Government Gilts: Government bonds are exempt from SDRT
AIM Shares: Alternative Investment Market shares have been exempt since 28 April 2014. Section 99(4B) FA 1986 excludes securities admitted to trading on a recognised growth market, and not listed on any market, from the definition of chargeable securities, so they escape both the 0.5% principal charge and the 1.5% higher charge. Purchases before 28 April 2014 were chargeable.
Foreign shares on overseas exchanges: Shares traded and settled outside the UK typically aren't subject to SDRT
Gifts with no consideration: If shares are transferred as a gift with no money changing hands, there's no SDRT
Transfers between spouses: No SDRT when shares are transferred between married couples or civil partners as a gift

Corporate Transactions

Certain corporate restructuring and takeover scenarios have different rules. For example, share-for-share exchanges in mergers may have relief provisions.

Good to Know:

ISAs (Individual Savings Accounts) and SIPPs (Self-Invested Personal Pensions) do not provide SDRT exemption. You still pay 0.5% SDRT when buying shares inside these tax-efficient wrappers, though you benefit from income tax and capital gains tax advantages.

Buying soon? Get your stamp duty checked before you commit

A specialist can confirm the right figure and flag any reliefs you qualify for.

CREST and Electronic Transfers

CREST is the UK's electronic settlement system for share transactions. It's operated by Euroclear UK & International and handles the majority of UK share trades.

How CREST Works with SDRT

When you buy shares electronically, the trade is settled through CREST
CREST automatically calculates the 0.5% SDRT liability
Your broker or platform collects the SDRT from you
CREST remits the tax to HMRC on your behalf

This process is seamless. As an individual investor, you simply see the 0.5% charge added to your purchase cost. There's no need to file a tax return or contact HMRC directly.

Example: Online Broker Purchase

Share purchase: £5,000

Broker commission: £10

SDRT (0.5%): £25

Total cost: £5,035

The £25 SDRT is automatically collected and passed to HMRC via CREST.

Dematerialized Holdings

Most UK shares are now held in dematerialized (electronic) form within CREST. This means no physical share certificates exist, and all transfers are subject to SDRT rather than traditional stamp duty on physical certificates.

How SDRT is Collected

SDRT collection is fully automated for electronic trades. Here's how it works:

Collection Process

Trade execution: You place an order to buy shares through your broker
SDRT calculation: The system automatically calculates 0.5% of the purchase price
Settlement: On T+2 (two days after trade), shares and cash are exchanged
SDRT deduction: Your broker debits the SDRT amount from your account
Remittance to HMRC: CREST collects and remits SDRT to HMRC on behalf of all buyers

No Tax Return Required:

Unlike SDLT (where your solicitor files a return), SDRT is collected at source. You don't need to file any paperwork or contact HMRC. The charge simply appears on your broker statement.

Physical Share Certificates

If you buy shares and receive a physical stock transfer form (now rare), you pay stamp duty on shares instead of SDRT. You must:

Calculate 0.5% of the purchase price (rounded up to nearest £5)
Submit the stock transfer form to HMRC's Stamp Office
Pay the stamp duty within 30 days

Common Questions

Can I avoid SDRT by buying in an ISA or SIPP?

No. SDRT is charged on the purchase of shares regardless of the account type. ISAs and SIPPs provide income tax and capital gains tax benefits, but not SDRT relief. You still pay 0.5% when buying UK shares within these accounts.

Do I pay SDRT when I sell shares?

No. SDRT is charged only on purchases, not sales. When you sell shares, the buyer pays the SDRT. You may be liable for capital gains tax on any profit, but that's a separate tax.

Is SDRT charged on US or international shares?

Generally no. Shares of foreign companies traded and settled on overseas exchanges (e.g., US stocks on NYSE or NASDAQ) are not subject to UK SDRT. However, some foreign companies maintain a UK share register, in which case SDRT may apply. Check with your broker.

What about ETFs and investment trusts?

UK-domiciled investment trusts are subject to SDRT when you buy shares. For ETFs, it depends on structure: UK-domiciled ETFs usually incur SDRT, while Irish or Luxembourg-domiciled ETFs typically do not (though they may have other transaction costs).

Can I claim SDRT back?

In most cases, no. SDRT is a final tax on the transaction. However, if SDRT was charged in error (e.g., on an exempt transaction), you can apply to HMRC for a refund within specified time limits.