Interactive Investor

Stamp Duty on Shares.

Stamp duty isn’t just something you pay when buying property. Find out all you need to know about paying stamp duty when trading shares.

Please remember, investment value can go up or down and you could get back less than you invest. The value of international investments may be affected by currency fluctuations which might reduce their value in sterling.

Stamp duty is applied to more than just buying property, it’s also part of investing. It applies to everyone and must be paid within 30 days. 

How stamp duty is paid depends on how you trade. Read on to find out how it will apply to you.

What is stamp duty on shares?

Stamp duty, also known as Stamp Duty Reserve Tax (SDRT), is a tax on documents and it’s charged by the government for transferring ownership. 

We usually hear about it when buying houses, but it also matters when buying shares. It applies regardless of whether you purchase your shares online or physically with certificates by share transfer.

How much is stamp duty on shares?

When it comes to buying UK shares, the way stamp duty is applied depends on how you make your purchase. 

Share purchase – purchasing your shares electronically online or through a broker like a nominee trading platform.

Stamp duty for electronic (paperless) purchases is 0.5% and will be included as part of the overall cost for the trade. This is the most common way to hold shares.

For shares purchases involving physical share certificates, stamp duty is also 0.5% but will only apply on trades valued at more than £1,000. 

Share transfer – this doesn’t mean transferring your shares between brokers or accounts. This refers to privately buying your shares from another person. In other words, without using a broker or trading platform. Stamp duty in this case is referred to as Stamp Duty Reserve Tax (SDRT). 

Stamp duty will still apply at 0.5% of the total value of the share. But you’ll need to calculate this yourself and inform HMRC manually, along with your payment.

Whilst UK stamp duty doesn’t apply to international investing, other countries may charge stamp duty. For example, Irish stamp duty is 1% on equity buys and Hong Kong stamp duty is 0.1% on buys and sells of equity and company warrants. Take a look at other taxes and levies that might apply.

How do you pay stamp duty on shares?

For share purchases, the UK uses a system called CREST (Certificateless Registry for Electronic Share Transfer) to simplify registering shares in an owner’s name. Your broker will add the cost of stamp duty to your transaction if it’s due and CREST will forward it to HMRC when they re-register the shares in the new owner’s name. This makes things far easier for investors who use a trading platform to trade.

For share transfers (or privately sold shares) that don’t use the CREST system, stamp duty isn’t automatically taken care of. The person buying the shares will need to calculate their own stamp duty liability and pay HMRC within 30 days.

After stamp duty has been paid, HMRC will also need informing that it’s been paid, either by email or by post.

You won’t need to pay stamp duty if your trade is valued at £1,000 or less. But for anything over this the rate is 0.5% rounded up to the nearest £5.

Stamp Duty at ii

  • With an ii account, stamp duty is made easy. We calculate it and you’ll see it in the cost of the trade when you place it. 
  • It’ll also be clearly shown on your contract note, found in the document section of your account so you’ll have a record of it and be confident knowing it’s been taken care of. 

Deadlines and penalties

If you’re trading with a broker, they should calculate stamp duty in the overall cost, and it’s paid when you place your trade. But if you’re required to do this yourself, you must inform and pay HMRC within 30 days of your documents being dated and signed.

Failing to do this in time can result in late submission penalties. Usually, a percentage of the duty due, depending on how late it is. You could also end up paying interest for every day it’s overdue.

It’s best to pay on time as any charges in the end add to the overall cost of your trade and take away from potential profit.

How to avoid stamp duty on shares?

Stamp duty isn’t due on all transactions, so there are a few ways to avoid it. Although it’s important to be aware of, avoiding stamp duty shouldn’t be a main factor in choosing what investments to choose. There are other more important things to consider, such as the risk, potential for return and cost.

You won’t pay UK stamp duty when:

Stamp duty on shares FAQs

Open an account

Whether you are looking for a general trading account, an ISA or a SIPP, we’ve got you covered with a low, flat fee.


Make the most of your tax-free savings allowance with our great value, award-winning ISA.


Our flexible account, where you can invest in all markets in the way you want.


Take control of your pension with our £5.99 a month Which? Recommended SIPP.