Modernisation of the Stamp Taxes on Shares framework — Securities Transfer Tax
Published 13 July 2026
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Who is likely to be affected
Individual investors, financial institutions, brokers, intermediaries, registrars and other financial market participants involved in the buying and selling of UK securities.
General description of the measure
The Securities Transfer Tax (STT) is a single, self-assessed tax on the transfer of securities. It will replace Stamp Duty (SD) and Stamp Duty Reserve Tax (SDRT) (collectively called Stamp Taxes on Shares (STS)).
This measure modernises STS, by simplifying and fully digitising the administration and payment of tax on transactions in securities. This will ensure that all transactions are taxed under a comprehensive digital system, thereby removing the need for non-electronic instruments and paper-based reporting and payment processes. The measure also clarifies the treatment of a small residual population of pre-2003 land transactions currently within the SD regime, as part of the wider modernisation programme.
Policy objective
The objective of this measure is to modernise and simplify the STS framework by replacing two interdependent taxes with a single, clear, self-assessed and digital first tax, improving certainty, efficiency and ease of use for taxpayers and financial market participants.
This supports the government’s wider objectives of tax simplification and modernisation, as well as facilitating the wider modernisation, innovation and improved liquidity of capital markets.
Background to the measure
In November 2018, an initial consultation on changes to the STS consideration rules was launched, and it was concluded that changing a single aspect of the regime would be ineffective without considering the STS framework as a whole. Subsequently a Call for Evidence was published in July 2020. The Call for Evidence explored guiding design principles and options for the modernisation of STS, and the response was published in July 2021.
In November 2021, HMRC established an industry working group comprised of 32 members who met bi-monthly until October 2022 to consider the shape of possible modernisation reforms. As a result of those discussions, a formal consultation was undertaken on STS modernisation, proposing the replacement of SD and SDRT with a single tax on securities. The consultation ran from 27 April 2023 to 22 June 2023, and sought formal views on the potential areas for reform in relation to the 0.5% principal charging regime. A summary of responses and consultation outcome, confirming the government’s intention to proceed with a single on the transfer of securities was published on 28 April 2025. A consultation on the rules for the higher 1.5% rate of tax was also published, and a summary of responses for that consultation has been published today.
Detailed proposal
Operative date
The government is aiming to introduce the single tax, its legislative framework and the portal in 2027. An update on the commencement date will be provided this autumn.
Transitional arrangements will apply to transfers of securities entered into before the commencement date to which SD or SDRT applies but is not due to be reported or paid until on or after that date.
These transitional arrangements for SD and SDRT through savings provisions will apply for a period of 4 years from the commencement of the STT.
Current law
The Stamp Act 1891 and Schedule 13 Finance Act 1999 sets out the main scope and charging provisions to Stamp Duty.
Part IV of Finance Act 1986 sections 86 to 99 sets out the main scope and charging provisions for Stamp Duty Reserve Tax.
Proposed revisions
Legislation will be introduced in Finance Bill 2026-27 to enable commencement of the STT in 2027.
Amendments to relevant legislation which applies to SD and SDRT will be made so that SD and SDRT will no longer apply to transfers of securities entered into on or after the commencement date.
The proposed changes to legislation will introduce savings provisions for SD and SDRT that will apply for a period of 4 years from the commencement of the single tax, so that taxpayers have sufficient time to complete any existing transactions to which either SD or SDRT applies.
New legislation will introduce the STT, including when a charge arises, the calculation of the tax, exemptions, payment, reporting, compliance and administration rules, as well as miscellaneous and general provision, including interpretation.
Summary of impacts
Exchequer impact (£ million)
| 2026 to 2027 | 2027 to 2028 | 2028 to 2029 | 2029 to 2030 | 2030 to 2031 | 2031 to 2032 |
|---|---|---|---|---|---|
| Empty | Empty | Empty | Empty | Empty | Empty |
The final costing will be subject to scrutiny by the Office for Budget Responsibility and will be set out at a future fiscal event.
Macroeconomic impact
This measure will be formally assessed once costings have been certified by the Office for Budget Responsibility but is not expected to have any significant macroeconomic impacts.
Impact on individuals, households and families
The measure will impact an unknown number of individuals by replacing SD and SDRT with STT. Individuals involved in the buying and selling of UK securities will need to be aware of the change, but this does not create any additional burden for them.
This measure is not expected to impact on family formation, stability or breakdown.
This measure is expected to impact individuals experience of dealing with HMRC as the reporting and payment of STT will be digitised, reducing processing times.
Equalities impacts
HMRC does not currently hold data on the protected characteristics of individuals involved in the purchasing of securities. However, the demographics of the general stocks and shares holder population were assessed to determine if any protected groups are estimated to be overrepresented. Where this is the case, it is likely they are also overrepresented in the population impacted by this measure. However, estimates are uncertain.
Stocks and shares holders are estimated to be older in age, with those aged 55 to 75+ (61%) overrepresented compared to their prevalence in the overall UK adult population (41%). Males (58%) are also estimated to be overrepresented in this population compared to the UK adult population (50%).
People from a White English, Welsh, Scottish, Northern Irish, or British ethnic background are estimated to be overrepresented (88%) in the stocks and shares holder population compared to their representation in the UK adult population (82%). Those from the Christian faith are also estimated to be overrepresented in this population (57%) compared to the UK adult population (52%). Finally, those who identify as heterosexual are estimated to be overrepresented in the stocks and shares holder population (77%) compared to the UK adult population (66%).
Where data were available, no other protected characteristic group was estimated to be overrepresented in this population.
Administrative impact on business including civil society organisations
The measure will have a negligible impact on businesses involved in the transfer of chargeable securities in relation to administrative burden.
One-off costs will include familiarisation with the STT legislation, minor changes to the CREST (UK Central Securities Depositary) system, and the implementation of the new HMRC digital service to report and pay the STT for transfers which take place outside CREST into business processes. As the basic principles for accounting for tax on the transfer of securities will remain broadly unchanged from those under the existing STS regime, businesses that currently account for STS on transfers of securities are expected to be able to adapt to the STT with minimal disruption. It is not expected that there will be new ongoing costs.
The measure is expected to impact businesses’ experience of dealing with HMRC as the transfer of securities will be dealt with under a single comprehensive digital system.
The measure is not expected to impact on civil society organisations.
Operational impact (£ million) (HMRC or other)
HMRC expects to incur one-off capital costs to develop the new digital service for customers to report and pay the STT, and make changes to IT systems in relation to transfers of securities applicable to SD and SDRT following commencement of the STT. This is estimated to be up to £20 million.
Any additional operational and staffing costs arising from this measure will be met from within existing resources.
Other impacts
Other impacts have been considered but none have been identified.
Monitoring and evaluation
The measure will be kept under review through communication with affected taxpayer groups.
Further advice
If you have any questions about this change, contact the Stamp Taxes Policy team by email: sts.consultation@hmrc.gov.uk.