The government has published draft legislation for a new Securities Transfer Tax (STT), which is expected to replace Stamp Duty and Stamp Duty Reserve Tax from 2027. The aim is to modernise the tax treatment of share and securities transactions by moving to a single, digital and self-assessed regime.

For companies, investors, registrars and advisers involved in share transfers, the proposals should simplify administration. However, they also introduce new practical responsibilities, particularly around digital reporting, payment deadlines and evidencing compliance before company registers are updated.

What is changing?

  • A single tax: STT will replace the current Stamp Duty and SDRT regimes for taxable securities transactions.
  • Digital reporting and payment: Off-market transactions will be reported and paid through a new HMRC online service, removing the need for paper-based stamping.
  • Transaction references: The online service is expected to issue a Unique Transaction Reference Number, which registrars may require before updating the register of members.

Key points to note

  • The main rate is expected to remain at 0.5%: The government has indicated that the underlying tax cost for most transactions should remain broadly familiar.
  • Existing reliefs should continue: Key reliefs, including group relief and acquisition or reconstruction reliefs, are expected to be retained within the new framework.
  • Different payment deadlines will apply: Electronic settlement transactions are expected to have a 14-day deadline, while off-market private company transfers are expected to have a 30-day deadline.
  • Contingent consideration will need careful handling: Where the final price is uncertain, deferral applications may be available, subject to the detailed rules.

Why this matters

The move to STT should make share transfer administration faster and more consistent. 

One area that will require particular attention is adviser involvement. The draft rules may create responsibilities for agents who submit returns on behalf of clients. Professional firms (such as CT) will therefore need to consider carefully how they support clients with STT filings and what protections should be put in place.

What should businesses do now?

  • Identify upcoming share transfers or corporate transactions that may fall close to the implementation date.
  • Review internal processes for collecting transaction data, calculating consideration and retaining evidence.
  • Consider how responsibility for STT submissions will be allocated between the business, advisers and registrars.
  • Monitor the consultation process and any updates to the final legislation.

Next steps

The technical consultation is open until 7 September 2026, with implementation expected in 2027. If you are planning a share transfer, restructuring or acquisition, now is a good time to assess how the proposed rules may affect completion mechanics, filing responsibilities and transaction timetables.

Our corporate finance and tax teams are monitoring the proposals closely. Please get in touch if you would like to discuss how STT could affect an upcoming transaction.