What is stamp duty?
Stamp duty is a type of UK tax, first introduced back in the 17th century. Its most well-known form these days is the ‘Stamp Duty Land Tax’ you pay when you buy a property.
But it’s also payable when you buy certain investments. The Stamp Duty Reserve Tax (SDRT) applies when you buy most UK shares online, and comes to 0.5% of the total of the transaction.
As your broker, we’ll automatically add stamp duty (where it’s applicable) to the cost of your share deal and pay it to HMRC for you. You’ll see this charge included on your contract note when you buy the investment, alongside our dealing charge.
Stamp duty applies for all UK-listed shares, except for the majority of those listed on the London Stock Exchange’s Alternative Investment Market (AIM). It also won’t apply when you buy funds (unit trusts, OEICS) or exchange-traded funds.
You don’t need to pay SDRT when you sell shares.