UK Stamp Duty Glossary

Additional Dwelling Supplement (ADS)

Definition: Scotland's surcharge on the purchase of additional residential properties, charged on top of standard LBTT rates. Administered by Revenue Scotland under the Land and Buildings Transaction Tax (Scotland) Act 2013, as amended.

ADS applies when a buyer (or any joint buyer) already owns another residential property anywhere in the world at the effective date of the new purchase, and the new property costs £40,000 or more. The current rate is 8% on the entire purchase price (raised from 6% on 1 December 2024). ADS is in addition to standard LBTT, so the combined liability can be significant on multi-property purchases.

A refund of the surcharge is available if the buyer replaces their main residence and sells the previous home within 36 months of the new purchase. See the Scotland LBTT calculator for the full ADS-inclusive bill, or the current LBTT rates page for the rate schedule.

See also: Higher Rates for Additional Dwellings (the SDLT equivalent for England and Northern Ireland).

Beneficial Interest

Definition: The equitable right to benefit from a property — including occupation, rental income, and sale proceeds — even where the person does not hold the legal title at the Land Registry. Beneficial interest can exist independently of, or alongside, legal ownership.

For SDLT purposes, beneficial interest matters because HMRC treats a person as “owning” a property if they have a beneficial interest in it, even if their name is not on the title. This affects first-time buyer relief eligibility (you cannot claim FTB relief if you have a beneficial interest in any residential property anywhere in the world) and the higher rates surcharge (you may trigger the surcharge if you have a beneficial interest in another residential property at the effective date).

Beneficial interest typically arises through a declaration of trust, an inherited share held in trust, or an implied trust based on financial contribution. See the trusts and stamp duty guide for the SDLT treatment of trust-held property and the adding a name to house deeds guide for declaration-of-trust scenarios.

Chargeable Consideration

Definition: HMRC's term for the total amount used to calculate SDLT. Usually equal to the purchase price, but defined more broadly in Finance Act 2003 Schedule 4 to include any consideration in money or money's worth given for the transaction.

Chargeable consideration includes: cash paid; any mortgage or other debt assumed by the buyer (under Schedule 4 paragraph 8); the value of any goods, services or works provided in exchange; the release of existing debts; and the assumption of liabilities. For most straightforward residential purchases, the chargeable consideration is simply the price agreed in the contract.

The concept matters most in transfers of equity and intra-family transactions where no cash changes hands but mortgage debt is assumed. See the transfer of equity complete guide for worked examples of how mortgage assumption translates to chargeable consideration.

Completion Date

Definition: The date on which legal ownership of a property transfers from seller to buyer and the balance of the purchase price is paid. This usually serves as the SDLT effective date — the date from which the 14-day SDLT filing and payment window begins.

Completion is distinct from exchange of contracts: at exchange, the sale becomes legally binding and a deposit is typically paid, but no SDLT is due. SDLT only crystallises at completion (or earlier if substantial performance occurs). The keys, the funds, and the legal title all move on the completion date.

Completion can be the same day as exchange or weeks/months later. SDLT is calculated using the rates in force on the completion date, not the exchange date — so a purchase exchanged in March but completed after the 1 April rate change pays the post-change rates. See the standard purchase guide for the exchange-vs-completion mechanics in detail.

Effective Date

Definition: The date from which SDLT liability arises. SDLT must be paid and the SDLT1 return filed within 14 days of the effective date. For most transactions the effective date is the same as the completion date.

The effective date can be brought forward by “substantial performance” — where the buyer pays 90% or more of the purchase price, or takes possession of the property before formal completion. In that case the SDLT effective date is the date of substantial performance, and the 14-day clock starts then, not at later completion.

For LBTT (Scotland) and LTT (Wales), the equivalent effective-date concept applies but with a longer 30-day filing window. See the SDLT filing and payment guide for the full timeline and penalties for missing the deadline.

Higher Rates for Additional Dwellings (HRAD)

Definition: The SDLT surcharge applied to purchases of additional residential properties in England and Northern Ireland, set out in Finance Act 2003 Schedule 4ZA. The current surcharge is 5% on top of standard SDLT rates (raised from 3% on 31 October 2024).

Higher rates apply when, at the effective date, the buyer (or any joint buyer) owns another residential property anywhere in the world worth £40,000 or more, and the new property is not replacing their main residence. They apply to every band, so the calculation is the standard SDLT plus 5% of the entire purchase price.

Replacement-of-main-residence relief allows a refund of the surcharge if the previous main residence is sold within 36 months of the new purchase. For Scotland the equivalent is the Additional Dwelling Supplement; for Wales LTT, higher rates are charged on a separate band structure rather than as a flat surcharge. See the second home / buy-to-let calculator for an instant HRAD-inclusive figure.

LBTT — Land and Buildings Transaction Tax

Definition: Scotland's property transaction tax, which replaced SDLT in Scotland on 1 April 2015 under the Land and Buildings Transaction Tax (Scotland) Act 2013. Administered by Revenue Scotland, with rates set by the Scottish Government.

LBTT has its own band structure separate from SDLT. The current residential nil-rate threshold is £145,000 (or £175,000 for first-time buyers). On additional residential properties, the Additional Dwelling Supplement of 8% is added on top of LBTT. LBTT returns must be filed within 30 days of the effective date — longer than SDLT's 14-day window.

Both freehold and leasehold property transactions in Scotland are within LBTT. For a current-rate calculation, use the Scotland LBTT calculator; for the rate schedule see current LBTT rates; for a full guide see the Scotland LBTT complete guide.

Linked Transactions

Definition: Two or more property transactions between the same buyer and seller (or connected parties) that HMRC treats as a single transaction for SDLT purposes under Finance Act 2003 section 108. SDLT is calculated on the cumulative consideration paid across all linked transactions, not each transaction individually.

Linking applies where the transactions form part of a single scheme, arrangement or series of transactions. The practical effect is that buying two £200,000 properties from the same seller in a linked deal is taxed as one £400,000 purchase (which pushes the consideration into higher rate bands) rather than two separate £200,000 purchases.

The most common context for linked transactions today is shared ownership staircasing once cumulative ownership passes 80%, where every subsequent staircasing tranche is linked. See the linked transaction calculator for the SDLT figure on a multi-deal purchase, and the staircasing guide for the shared-ownership-specific linked-transactions rule.

LTT — Land Transaction Tax

Definition: Wales's property transaction tax, which replaced SDLT in Wales on 1 April 2018 under the Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017. Administered by the Welsh Revenue Authority (WRA).

LTT has its own band structure. The current residential nil-rate threshold is £225,000 — the highest of the three UK property taxes — but Wales offers no specific first-time buyer relief. On additional residential properties, Wales applies higher rates via a separate band structure (rather than a flat surcharge added on top), defined in regulations made under the LTT Act. LTT returns must be filed within 30 days of the effective date.

For a current calculation use the Wales LTT calculator; for the rate schedule see current LTT rates; for the full picture see the Wales LTT complete guide.

Main Residence

Definition: Your primary home for SDLT purposes — the property you live in as your principal residence at the relevant time. The concept matters because main residence status determines whether the higher rates surcharge applies on an additional property purchase and whether you can claim a refund of the surcharge after selling a previous home.

HMRC determines main residence on a question-of-fact basis. Relevant factors include where you spend most time, where your family lives, where you are registered for council tax and on the electoral roll, and where you have your work, GP and social ties. You can only have one main residence at a time, but the classification can change over time as circumstances change.

The most important practical rule: if you are replacing your main residence (selling your old home and buying a new one), the 5% higher rates surcharge does not apply provided the sale and purchase happen within 36 months of each other. If timing slips, the surcharge applies at completion and can be reclaimed once the old home is sold within the 36-month window. See the replacement main residence rules for the full mechanics.

Multiple Dwellings Relief (MDR)

Definition: An SDLT relief that allowed buyers acquiring multiple residential properties in a single transaction (or in linked transactions) to calculate SDLT on the average price per dwelling rather than the total. Abolished from 1 June 2024 for transactions with an effective date on or after that date.

Before abolition, MDR was a significant tax saving on portfolio purchases, mixed-use deals with a residential element, and properties with self-contained annexes. The relief was withdrawn following findings that it was being used aggressively for properties with marginal claims to multiple-dwelling status (e.g. annexes that were arguably not separate dwellings).

MDR remains relevant for historical claims: transactions completed before 1 June 2024 can still benefit from MDR, and refund/correction claims may still be made within the SDLT amendment window. For transactions after that date, alternative reliefs (such as the non-residential rate on mixed-use transactions) may apply. See the MDR calculator (now positioned for historical claims) for the maths.

Net Present Value (NPV)

Definition: The present-day value of all future rent payments under a lease, used to calculate the rent element of SDLT on lease transactions. HMRC uses a 3.5% annual temporal discount rate to convert the future rent stream into a single present-value figure.

NPV matters because when a new lease is granted, SDLT applies to two components: any premium paid (taxed as standard consideration) and the NPV of the rent. For a constant annual rent R over n years, the simplified formula is NPV = R × [(1 − (1 / 1.035n)) / 0.035]. The Leasehold Reform (Ground Rent) Act 2022 makes most new residential leases “peppercorn” ground rent (effectively £0), which reduces NPV to zero and removes the rent SDLT element entirely.

NPV is most relevant for commercial leases and for new-build residential leasehold purchases granted before the 2022 Act. See the ground rent NPV explanation in the lease transactions guide for the full formula, annuity factors and worked examples.

Nil-Rate Band

Definition: The portion of a property purchase price on which no stamp duty is charged. The current nil-rate thresholds are £125,000 for SDLT (England and Northern Ireland), £145,000 for LBTT (Scotland), and £225,000 for LTT (Wales).

For first-time buyers in England and Northern Ireland, an enhanced nil-rate band of £300,000applies on properties up to £500,000. Scotland gives first-time buyers a nil-rate of £175,000. Wales does not offer specific first-time buyer relief but its higher general nil-rate threshold benefits all buyers.

The English nil-rate band was £250,000 until 31 March 2025 and reverted to £125,000 from 1 April 2025 (the FTB threshold also reverted, from £425,000 to £300,000). See the current UK SDLT rates page for the full band structure or the April 2025 changes guide for the threshold history.

SDLT — Stamp Duty Land Tax

Definition: The property and land transaction tax paid in England and Northern Ireland on purchases above the nil-rate threshold. Introduced by Finance Act 2003 to replace the older stamp duty (a document-based tax), SDLT is now a transaction tax based on consideration and is administered by HMRC.

SDLT is calculated progressively across rate bands: 0% on the first £125,000; 2% on £125,001–£250,000; 5% on £250,001–£925,000; 10% on £925,001–£1,500,000; and 12% above £1,500,000. A 5% higher rates surcharge applies on additional dwellings; a 2% surcharge applies to non-UK-resident buyers; and a flat 17% rate applies to corporate bodies buying residential property over £500,000 (raised from 15% on 31 October 2024). Filing and payment are due within 14 days of the effective date.

Scotland and Wales have their own equivalent taxes — see LBTT and LTT. For a current calculation use the SDLT calculator on the homepage or see the current SDLT rates page for the full schedule.

Transfer of Equity

Definition: The legal transfer of a share of property ownership from one person to another, where the existing owner(s) remain on the title. Common scenarios include adding a partner to the deeds, removing an ex-partner after separation, and gifting equity to family members.

SDLT may apply on a transfer of equity to the extent of any chargeable consideration passing — typically cash paid and the share of any mortgage debt assumed. Transfers between spouses or civil partners are exempt under Finance Act 2003 section 73 regardless of any consideration involved. Pure gifts with no mortgage and no cash payment have no chargeable consideration and so no SDLT.

The mechanism is a TR1 transfer deed signed by all parties and registered with the Land Registry, typically with lender consent if a mortgage is in place. See the transfer of equity complete guide for buyout/sale-equivalent transfers, or the adding a name to house deeds guide for gift/no-consideration scenarios. For divorce-related transfers, the divorce property transfer guide covers the section 3A court-order exemption.