Conveyancers face possibility of more stamp duty reform

Topics: Government & politics,Conveyancing

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Conveyancers could be in for more stamp duty shocks after chancellor George Osborne (pictured) pledged to continue taking ‘bold action’ on home ownership.

The government will confirm its final policy design to increase stamp duty land tax on the purchase of additional properties at the Budget on 16 March.


Yesterday the Treasury announced that more than 780,000 housebuyers had saved an estimated £657m on stamp duty since the tax was reformed in December 2014.

Under the old ‘slab’ system, homebuyers paid stamp duty at a single rate on the entire property price. In the new ‘slice’ system, homebuyers pay the rate of tax on the part of the property price within each tax band.

Osborne said: ‘The overwhelming number of homebuyers - 98% - are saving money thanks to our reform, which has done away with the unfair old system that means increases being imposed on those paying just a pound over the threshold.

‘I am determined that this government will continue to take bold action to support a home-owning democracy.’

Transaction levels at the ‘top end’ of the market remained ‘constant’ under the new regime and stamp duty receipts from homes costing more than £1m went up by 15% across the year, the Treasury said.

In last year’s autumn statement and spending review, the government announced higher rates of stamp duty on the purchase of additional residential properties as part of a ‘five-point plan’ to refocus support for housing towards low-cost home ownership for first-time buyers.

The proposed surcharge ran in to opposition from solicitors. Responding to a Treasury consultation on the change, the Law Society said that calculating liability for the duty could pose problems for conveyancers. 

The higher rates will be three percentage points above current SDLT rates and will come into force from 1 April.

Readers' comments (7)

  • How do we enforce the new SDLT rates,when we don't know the details of the new rules and regulations on this EXTRA tax,let alone dealing with the enforcement,refunds etc....??

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  • Yes. Only a Consultation Document has appeared, so far- presumably clauses in the 2016 Budget's Finance Bill will feature.

    PLEASE at least consolidate SDLT legislation.

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  • And while he's at it can he change the name back to Stamp Duty and do us all a favour?

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  • Is anyone accepting undertakings from S&G?

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  • ridiculous proposal. the theory that it will help people to get on the property ladder is hogwash.

    The big property investment cos are exempt anyway. Its just made it harder for people with modest incomes etc to invest in property.

    this change is to recoup the revenues lost under the new "slice" system.

    classic case of giving with one hand and taking away with the other

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  • "... stamp duty receipts from homes costing more than £1m went up by 15% across the year, the Treasury said."

    Evidently not enough to replace the £0.66 billion in lost SDLT revenue last year. Not that doing away with the slab system was a bad idea, but if the chancellor was aiming for fiscal neutrality he was a way off.

    I agree that the surcharge is to recoup the loss from switching to a progressive system. It won't affect the tax bills for first-time buyers and I doubt it will materially affect prices.

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  • Pace Mr. Loveridge (1 March @ 7.35pm) - it's gone way beyond "stamp duty", which was a duty on documents to ensure they were admissible in court. We should call it "Land Transaction Tax" as in Scotland, since in policy terms that is what it now is. It's a difficult balancing act - on the one hand, dealing with foreign - particularly non-EU - buyers that force up prices for all by shoveling huge amounts of money into the London property market and then leave the properties empty most of the year, but on the other hand not deterring decent buy-to-let landlords who are important for the supply of much needed homes for rental. Once key workers are priced out of accommodation you have a real problem; one could foresee this happening even pre-2008 crash, and now here we are...

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