Amidst the broader UK stamp taxes on shares modernisation efforts (discussed here and here), today in her Autumn Budget 2025, the Chancellor of the Exchequer (Rachel Reeves MP) turned her attention to UK stamp duty's younger sibling: stamp duty reserve tax (SDRT). 

Rather chaotically, the Office for Budget Responsibility’s Economic and Fiscal Outlook – November 2025 report had leaked immediately before the Chancellor's budget speech to Parliament. That leaked report did not mention the proposed SDRT measure later revealed by the Chancellor in her Parliamentary speech but, in any case, the Financial Times had received details of this policy measure as early as October 2025. 

What has been announced?

The measure, branded ‘UK Listing Relief’, is a new exemption from the 0.5% charge to SDRT for securities in companies that are newly listed on a UK regulated market. This exemption will apply for the first three years of a company being listed in the UK and will have effect from 27 November 2025. SDRT applies in respect of what the legislation describes as ‘chargeable securities’ (rather than simply shares) and so, as expected, UK Listing Relief is described in its Policy Paper as applying to “all of the company’s securities (not just shares)” (including depositary receipts over that company’s securities). 

Notably, this announcement does not attempt to amend or adjust the 1.5% charge to SDRT (often referred to as the ‘season ticket’ charge), which is frequently a significant hurdle to overcome in the listing process. This may be because HM Treasury (i) does not consider amending the 1.5% SDRT charge as being capable of delivering its desired policy outcome; and/or (ii) considers that the 1.5% SDRT charge (along with its challenges) was adequately addressed by the relevant changes in the Finance Act 2024 (discussed here).

The clear backdrop to this was a dearth of de-listings from the London Stock Exchange (LSE) across both the main market and the LSE's junior Alternative Investment Market (AIM), coupled with London IPO fundraising being at a 30-year low. It was only a matter of time before a Chancellor attempted to address the challenge of making listing in the UK more appealing to high-growth private companies, which often have listing venues worldwide competing to be their first-choice destination.

What is the UK Listing Relief intended to achieve?

The intention of this measure, in HM Treasury’s own words, is to: 

“… enable newly-listed companies to secure higher share prices, boost trading volumes and improve their access to capital – supporting their long-term growth prospects.”

It is worth immediately pointing out the nuance that shares which trade on AIM already benefit from not being subject to SDRT as a blanket matter. So, for companies currently considering admission to trading on AIM, this new exemption will be of little relevance. That being said, shares admitted to trading on AIM are the subject of a relief reduction for the purposes of business property relief (an inheritance tax relief often touted as a major benefit of investing in AIM) starting from April 2026. That change was announced in the Autumn Budget 2024, so it may indeed come as a relief to some that the Chancellor somewhat ignored AIM-traded shares in her Autumn Budget 2025. 

Broadly then, this is a measure aimed directly at making a listing on the main market of the LSE more appealing. The timing of this is no coincidence – a number of high profile, particularly technology-heavy, private companies are actively searching for a listing venue.

SDRT being chargeable upon trading of shares in UK listed companies has often been cited as one of the reasons for (i) an increasingly common decision not to list in the UK at all; (ii) depressing the prices of quoted equities in the UK; and/or (iii) adversely affecting liquidity in London’s quoted equity markets. 

The exemption has the potential to, at face value, bolster the appeal of listing in the UK but may well be hamstrung by the possible cliff-edge arising after the three-year exemption ends. After all, if investors and other market participants have become accustomed to dealing in the shares of a company without having to build SDRT into their costs for three years, what happens to the pricing and liquidity of those same shares when those same investors and market participants suddenly need to start building in that cost? Alternatively, investors and market participants may end up pricing the three-year cliff-edge into the shares prior to the exemption ending, which would dilute one of the key intentions of the measure: securing higher share prices. 

Is this relevant to companies already trading on a UK market?

The short answer is that this measure is not relevant to companies already trading on a UK market. 

As noted above, if a company is already traded on AIM, this measure broadly puts newly (LSE main market) listed companies on a similar SDRT footing for a period of three years following the date of listing. The difference of course being that a newly listed company on the main market of the LSE may have securities (other than shares) in issue which benefit from UK Listing Relief (which, in practice, is unlikely to have material benefits). Beyond that, as mentioned, shares traded on AIM still benefit from business property relief for inheritance tax purposes - shares not traded on AIM carry no such benefit. 

For a company already listed on the main market of the LSE, the announced changes will have no effect. This is strictly a measure to encourage new listings and is likely to come as a blow to companies already listed on the main market of the LSE, particularly considering the number of larger LSE-listed companies which have switched their primary listing away from London over recent years. The cost of SDRT almost always comes up in conversations concerning discussions with investors pushing to change listing venues or indeed as the boards of UK listed companies look towards foreign listing venues wondering whether a more lucrative market capitalisation could be achieved overseas. 

In reality, granting a boon to newly listed companies as opposed to companies already listed in the UK is likely to be, in part, a cost-based decision. Granting an SDRT exemption for newly listed companies does not represent a material cost to the Treasury – the Autumn Budget 2025 documents estimate this measure to cost £50m a year by 2028-2029. Contrast that to the £2.295 billion of SDRT the Treasury benefitted from during 2023-2024 alone and it becomes easy to see why a decision to give up even a small proportion of that income would be unlikely to come from a Chancellor who is eager to plug an ever-growing hole in the public finances. 

The silver lining though is that the success of London as a listing venue is clearly being considered a key part of UK Government policy in a way it has not previously been. For companies already listed in London and looking for reasons to stay, the boon for newly listed companies may well be a sign of better things to come for London equity markets more generally. For example, as part of the Autumn Budget 2025 the Chancellor reduced the limit for cash individual savings accounts to £12,000 which may have the effect of funnelling additional cash into UK equities (though the Chancellor stopped short of making any UK equity allocation mandatory).  

What next?

This measure is effective from 27 November 2025. Legislation will be introduced in the upcoming Finance Bill to amend the relevant provisions of the Finance Act 1986. 

Time will (hopefully, shortly) tell whether this measure can deliver on its intended policy outcome. No doubt many private companies will have been observing the budget looking for some good news following the arduous wait for what was largely expected to be a somewhat painful budget. 

If this policy measure does indeed have the intended policy outcome in the medium to long term, there will be far more to be said for the eventual scrapping of UK stamp duty (and stamp duty reserve tax) in the future. Maybe in a few decades’ time we will all look back on the introduction of UK Listing Relief as simply a dry run…