HMRC's published guidance on Stamp Duty Reserve Tax summarised across five tax years. The 0.5% rate on electronic share purchases, the AIM exemption, the new UK listing relief from November 2025, and how CREST collects the tax automatically on your behalf.
All figures sourced from HMRC's Stamp Taxes on Shares Manual (STSM) on GOV.UK. The SDRT rate has been unchanged throughout the 2022/23 to 2026/27 period.
Stamp Duty Reserve Tax (SDRT) is a tax charged on electronic purchases of UK shares and certain other chargeable securities. Per HMRC's Stamp Taxes on Shares Manual (STSM) on GOV.UK, SDRT was introduced in 1986 to ensure that uncertificated (paperless) share transfers — which cannot attract traditional Stamp Duty, which requires a physical instrument to be stamped — were still subject to tax. Today, the vast majority of UK equity transactions are settled electronically through CREST, the UK's central securities depository, making SDRT the primary stamp tax that investors encounter in practice.
HMRC's full technical guidance on SDRT is contained in the Stamp Taxes on Shares Manual (STSM) on GOV.UK. The STSM sets out the charging provisions, exemptions, reliefs and collection mechanics for both SDRT and Stamp Duty. For SDRT specifically, the core charging provisions are at STSM021010. The new UK listing relief is at STSM042600–STSM042650.
For the overwhelming majority of investors, SDRT requires no action. When you buy UK shares through an online broker or investment platform using the CREST settlement system, the process per HMRC's guidance is as follows:
For off-market electronic transfers — those not processed through CREST — the purchaser may be responsible for self-assessing and paying SDRT directly to HMRC. Per HMRC's guidance, this applies to certain private transfers of shares not conducted through a standard broker and exchange.
Illustrative only. SDRT is rounded to the nearest penny. Applies only to qualifying UK shares settled via CREST. AIM shares and newly listed companies within the UK listing relief period are exempt. This is not advice.
Per HMRC's STSM Manual, SDRT is charged at one of three effective rates depending on the nature of the transaction and the market on which the shares are admitted to trading.
| Transaction type | SDRT rate | Notes |
|---|---|---|
| Standard electronic purchase of UK shares (CREST) | 0.5% | No minimum threshold — applies to all amounts |
| Transfer into clearance service or depositary receipt issuer | 1.5% | Higher rate; applies when securities move into specific overseas holding structures |
| AIM shares (recognised growth market, not also listed elsewhere) | Nil — exempt | SDRT abolished on AIM shares from April 2014 |
| Newly listed UK companies — UK listing relief (from 27 Nov 2025) | Nil — 3-year exemption | Company must notify CREST; exempt flag removed after 3 years |
| Qualifying group reorganisations and reconstructions | Relief available | Subject to specific HMRC qualifying conditions in STSM |
| Transfers between spouses or civil partners | Verify at STSM | Confirm specific treatment in HMRC STSM Manual before relying on any exemption |
Source: GOV.UK — HMRC STSM Manual. Not advice — verify specific transactions at GOV.UK before relying on any exemption.
Per HMRC's STSM Manual, SDRT applies to all electronic share purchases regardless of the amount of consideration. There is no minimum threshold below which SDRT does not apply. This is different from traditional Stamp Duty (on paper transfers), which only applies where consideration exceeds £1,000. An electronic purchase of £100 of shares still incurs SDRT of £0.50, collected automatically. This is a summary of HMRC's guidance.
Per HMRC's published guidance, both Stamp Duty and SDRT were abolished on shares admitted to trading on AIM (the Alternative Investment Market) and other HMRC-recognised growth markets from April 2014. This is a permanent exemption — not a temporary relief — and has applied consistently throughout the 2022/23 to 2026/27 period covered by this guide. The exemption condition is that the shares must be admitted to trading on a recognised growth market and not also listed on any other regulated stock exchange. If an AIM-quoted company also obtains a listing on a main market, the exemption falls away.
When you purchase shares in an AIM-admitted company through a standard UK broker, no SDRT is deducted. The 0% rate has applied since April 2014 and is reflected in HMRC's STSM Manual. This is one structural advantage of AIM shares over main-market shares for retail investors — the effective transaction cost is lower by 0.5% of the purchase price on each trade. However, SDRT is only one component of total transaction costs — stamp duty exemption does not mean there are no other costs or risks associated with AIM shares.
A common misconception is that buying shares inside a Stocks and Shares ISA or a SIPP exempts the purchase from SDRT. Per HMRC's published guidance, this is not the case. The ISA and SIPP wrappers provide Income Tax relief on contributions and CGT exemption on gains within the wrapper — but they do not affect the point-of-purchase SDRT charge. The 0.5% SDRT applies at the time of purchase in the same way whether the shares are bought inside or outside a tax-advantaged wrapper. The wrapper's tax advantage operates on the income and gains after the shares are held within it.
Following the Autumn Budget 2025, a new SDRT exemption was introduced for companies newly admitted to trading on a UK-regulated market. Per HMRC's STSM042600 on GOV.UK, the exemption applies to agreements to transfer shares where the company is within its 3-year listing relief period. The relief is designed to encourage new UK stock market listings and to improve secondary market liquidity for recently listed companies.
| Feature | Detail |
|---|---|
| Effective from | 27 November 2025 — agreements to transfer on or after this date |
| Duration | 3 years from date of admission to trading on a UK-regulated market |
| Scope | Applies to SDRT on secondary market share transfers; also Stamp Duty for paper transfers |
| Company obligation | Company (or registrar/issuer) must notify CREST that securities qualify for the exemption |
| Removal of exemption | Exempt flag must be removed from CREST at end of 3-year period |
| HMRC reference | STSM042600 to STSM042650 |
Source: GOV.UK — HMRC STSM042600. This is a reference summary only — not advice. Companies and investors should verify eligibility via HMRC's published guidance or qualified legal/tax counsel.
The UK listing relief guidance is published in HMRC's STSM Manual at STSM042600 through STSM042650. The relief was given immediate temporary statutory effect via Budget Resolutions on 27 November 2025 and received permanent legislative effect when Finance Bill 2025-26 received Royal Assent. Companies with shares admitted to a UK-regulated market on or after 27 November 2025 should review HMRC's STSM guidance or seek qualified legal advice to understand whether and how to claim the relief.
Per HMRC's published guidance, SDRT and Stamp Duty are two separate taxes on share transfers. Although both are charged at 0.5% in standard cases, they operate differently and apply to different types of transaction. The distinction matters in practice because the two taxes are assessed differently and have different minimum thresholds.
Source: GOV.UK — HMRC STSM Manual. This is a reference summary only — not advice.
HMRC has consulted on proposals to modernise the Stamp Taxes on Shares framework, potentially replacing the two separate taxes (SDRT and Stamp Duty) with a single, unified tax. As of the date of this guide (May 2026), this consultation has concluded but no legislation has been enacted to change the current two-tax structure. The 0.5% rates and collection mechanics described on this page remain the law in force. Monitor GOV.UK: Stamp Taxes Modernisation consultation for any future developments.
Per HMRC's published guidance, the SDRT rate has remained unchanged at 0.5% throughout the 2022/23 to 2026/27 period. The table below is provided as a historical reference. All figures are sourced from HMRC's STSM Manual on GOV.UK. This is a reference summary — not advice.
| Tax year | Standard SDRT rate | Higher rate | AIM shares | No. threshold |
|---|---|---|---|---|
| 2022/23 | 0.5% | 1.5% | Exempt | None |
| 2023/24 | 0.5% | 1.5% | Exempt | None |
| 2024/25 | 0.5% | 1.5% | Exempt | None |
| 2025/26 | 0.5% | 1.5% | Exempt | None |
| 2026/27 | 0.5% | 1.5% | Exempt | None |
Source: GOV.UK — HMRC STSM Manual. AIM exemption has applied since April 2014. UK listing relief (3-year exemption for newly listed companies) available from 27 November 2025. Not advice.
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This page is a summary of HMRC's published guidance — not personal tax or legal advice. SDRT questions often arise in the context of corporate transactions, off-market transfers or complex share schemes. Our free matching service connects you with verified UK tax specialists who can advise on your specific circumstances.
Answers based on HMRC's published STSM guidance with direct GOV.UK links. This is an informational guide only — not personal tax or legal advice.
This page is a summary of HMRC's published guidance — not personal tax or legal advice. Our free matching service connects you with verified UK tax specialists.
Important — informational guide only, not tax or legal advice. UK Tax Hero summarises HMRC's published guidance as a free information and expert-matching service. Nothing on this page constitutes personal tax advice, legal advice or financial advice. Figures, rates and rules are based on HMRC's published guidance for 2022/23 to 2026/27 and may be subject to change. SDRT can be complex in corporate transaction and restructuring contexts — specialist advice should always be sought for non-standard share transfers. Always verify on GOV.UK before relying on any figure or exemption. References to HMRC's STSM Manual sections are provided for reference purposes. UK Tax Hero is not regulated by HMRC, the FCA or any professional body.
