Stamp Duty and the Connected-Company Market-Value Rule (2026)

Move a home you already own into a company you control and it can feel like nothing has been sold — no buyer advertised, no price agreed, perhaps not a penny changing hands. Yet Stamp Duty Land Tax (SDLT) can still land, and it lands on the property's full market value, not on what was actually paid.

That is the effect of section 53 of the Finance Act 2003. Where a company buys a chargeable interest from someone connected with it, SDLT is charged on not less than the market value of what is transferred — even if the stated consideration is zero. A £0 "gift" of a £300,000 home into your own company is taxed as a £300,000 purchase: at 2026 rates that is £20,000 of SDLT (figure from the Homecost stamp duty calculator, fetched 9 July 2026).

For context on where the high-value end of the market sits: of the 699,846 full-market residential sales recorded across England in 2025, 18.7% (131,054 sales) completed above £500,000 (HM Land Registry Price Paid Data, fetched 9 July 2026) — the threshold at which an even steeper corporate charge, covered below, switches on.

What section 53 actually does

Ordinarily, SDLT is charged on the chargeable consideration — broadly, everything the buyer gives for the interest, in money or money's worth. Between two individuals, a genuine gift of a mortgage-free home carries no consideration and therefore no SDLT at all (Schedule 3, Finance Act 2003). Taking on a share of an outstanding mortgage does count as consideration, which is where transfers between people usually generate a bill — the mechanics are set out in our guide to transfer of equity and stamp duty.

Section 53 replaces that "what did you actually give" test with a floor. When the buyer is a company and the seller is connected with it — the connection test is the one in section 1122 of the Corporation Tax Act 2010, which catches, among others, a company and the person who controls it — the chargeable consideration is deemed to be at least the market value of the interest transferred. The rule also applies where part of the consideration is the issue or transfer of shares in a company connected with the seller.

The practical consequences:

• A director moving their own buy-to-let into their own limited company is connected with it, so the transfer is charged as a market-value purchase.
• The price the parties write on the paperwork does not cap the tax. Recording a nominal £1 changes nothing.
• Because the charge is on market value, an independent valuation is normally needed to file the return correctly.

Individuals are taxed on the deal; connected companies on the value

The gap between the two regimes is the whole story. Set against the actual-consideration rule that applies between individuals, the market-value deeming produces sharply different bills:

England, 2026 rates. Individual and company standard/surcharge figures from the Homecost stamp duty calculator, 9 July 2026.

† Above £500,000, a single 17% rate applies to a company's purchase of one dwelling unless a relief is available (Schedule 4A, Finance Act 2003): £600,000 × 17% = £102,000. Without the flat rate the standard-plus-surcharge figure would be £50,000.

Two things drive the company column higher, and they stack.

First: companies always pay the 5% surcharge

A company has no "only or main residence," so it cannot use the standard residential rates a homebuyer relies on. Purchases of dwellings by companies fall within the higher rates for additional dwellings (Schedule 4ZA, Finance Act 2003) — the 5% surcharge that rose from 3% on 31 October 2024. That surcharge is a flat 5% of the whole price, applied from the first pound: on a £300,000 transfer it adds £15,000 on top of the £5,000 standard charge, giving the £20,000 in the table. The surcharge mechanics, and how they apply to ordinary second-home buyers, are covered in our additional-property stamp duty surcharge guide.

Second: over £500,000, the 17% flat rate

Where a non-natural person — a company, a partnership with a corporate member, or a collective investment scheme — buys a single dwelling for more than £500,000, a single flat rate of 17% applies to the entire price (Schedule 4A, Finance Act 2003). This rate rose from 15% on 31 October 2024. It replaces the banded rates altogether: a £600,000 dwelling held through a company faces £102,000, not the £50,000 a standard-plus-surcharge calculation would give.

The 17% charge can be switched off by a relief — for example where the dwelling is held for a genuine property-rental business, for property development or trading, or is made available to the public. Where a relief applies, the charge reverts to the standard rates plus the 5% surcharge. Reliefs are conditions-based and can be withdrawn (clawed back) if the qualifying use stops within three years.

A related annual charge, the Annual Tax on Enveloped Dwellings (ATED), can also apply each year to dwellings worth over £500,000 held through a company, with its own reliefs and returns. The corporate £500,000 thresholds are compared side by side in our note on the limited-company landlord £500,000 twin rules.

When section 53 does not apply

Section 54 carves specific situations out of the market-value rule. The two most relevant here:

• Property held on trust. Where, immediately after the transfer, the company holds the property as trustee in the course of a business of managing trusts, the deeming is switched off.
• Distributions of company assets. Where a company distributes property to its members — for example a dividend paid in the form of the property, or a distribution on winding up — the market-value rule does not apply, subject to an anti-avoidance restriction if the company had itself acquired the interest using group relief within the previous three years.

Outside these exceptions, the default for a connected-company purchase is market value.

Filing still applies — even at nil consideration

Because the charge rests on deemed value rather than cash, a return is due on that value even when no money moves. A land-transaction return must generally be filed, and any tax paid, within 14 days of the effective date (section 76, Finance Act 2003). A transfer documented as a gift, or for a token sum, does not remove that obligation where section 53 applies.

Try the numbers

You can model any of these figures — standard rates, the 5% surcharge, and how price moves the effective rate — with the Homecost stamp duty calculator, and see the all-in cost picture for a high-value area such as SW1A 1AA in Westminster. More SDLT explainers sit in the Cost Intelligence section.

This is general information about how the rules work, not tax or legal advice, and every transfer turns on its own facts and valuation. Speak to a qualified adviser before acting.