Money Calculation

What SDLT rates do companies pay on residential purchases?


By MAR Accounants

        25 August 2022      5 min read

Stamp duty land tax or SDLT is a form of tax payable by the buyer on the purchase of land and buildings in England and Northern Ireland where the value is above a certain threshold. This threshold is known as the nil rate band. It is also payable on transfer of interests in land and buildings where no money has exchanged hands, with a few exceptions. For purchases made by companies, the nil rate band and the rate of tax is different from those of individuals. In this article we will talk about SDLT applicable to companies.

Temporary relief from SDLT on residential properties for individuals

The UK Government has temporarily increased the SDLT nil rate band for individuals purchasing residential property due to the COVID-19 pandemic. The nil rate band was increased from £125,000 to £500,000 for purchases during the period from 8 July 2020 until 31 March 2021. This was then extended during the March 2021 budget until 30 June 2021. From 1 July 2021, the nil rate band is halved to £250,000 and from 1 October 2021 it is set to revert back to £125,000.

Companies however, usually pay the higher rate of SDLT (an additional 3% above the standard rate – unless exemption applies). See below SDLT rates tables. As you will see, companies also benefit from the temporary increase to the standard and higher rate bands.

Rates of SDLT applicable to companies

Rates of SDLT payable by companies on residential purchases fall into one of four categories:

  1. Standard rates
  2. Higher rates – an extra 3% on the standard rates
  3. Flat rate of 15% – payable on the entire value where the residential property costs more than £500,000, subject to relevant conditions being met
  4. Non-resident rate – an additional 2% surcharge on all of the above SDLT rates where the buyer is UK non-resident, effective from 1 April 2021
Thresholds of SDLT applicable to companies

SDLT thresholds and rates applicable to companies on residential purchases depend on the date of the transaction:

From 8 July 2020 to 30 June 2021

Property valueStandard ratesHigher rates
Up to £500,0000%3%
£500,001 – £925,0005%8%
£925,001 – £1.5m10%13%
£1.5m and above12%15%


From 1 July 2021 to 30 September 2021

Property value      Standard ratesHigher rates
Up to £250,0000%3%
£250,001 – £925,0005%8%
£925,001 – £1.5m10%13%
£1.5 and above12%15%


From 1 October 2021 onwards 

Property value          Standard ratesHigher rates
Up to £125,0000%3%
£125,001 – £250,0002%5%
£250,001 – £925,0005%8%
£925,001 – £1.5m10%13%
£1.5 and above12%15%
Default rate of SDLT for companies

The rate that applies depends on the type of residential property that is being acquired, for example a leasehold property. Generally, the higher rate of SDLT is the default rate for companies and applies to purchases that meet the relevant conditions. Unlike the rules for individuals, this applies regardless of whether the company already owns a property or not. Where the value of property is below £40,000 the higher rates of SDLT will not apply.

15% flat rate of SDLT

A flat 15% rate was introduced as part of a series of anti-avoidance regimes to make property purchases under a corporate vehicle less attractive. Where the relevant conditions apply, the 15% rate will apply to the entire value of the residential dwelling acquired, and not just the amount in excess of a lower rate threshold. The 15% rate also takes priority over the higher rates so if the relevant conditions are met for the 15% flat rate, the higher rates does not apply. The 15% flat rate applies to purchases of certain types of dwellings on transactions above £500,000.

If the 15% rate does not apply, for example because the property qualifies for an exemption, then the higher rate will apply.

SDLT non-resident surcharge

Additional 2% surcharge on SDLT applies from 1 April 2021 to purchases of residential dwellings made by non-resident companies. The 2% surcharge applies in addition to the rates discussed above.

Exemptions from the higher rate of SDLT for companies

There are a number of exemptions to the higher rate of SDLT available for companies which means if the relevant conditions are met the standard rates of SDLT will apply.



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