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Stamp duty payments pass £12bn to hit record

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  • 21/10/2022
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Stamp duty payments pass £12bn to hit record
Stamp duty land tax receipts have totalled £12.1bn so far this year, a record amount.

Apart from January when the intake was £944m, tax generated by property transactions have totalled more than £1bn in the months leading up to September. 

This is up £3.2bn compared to the same period last year, but against the backdrop of the stamp duty holiday which lasted until September 2021. 

The report noted that the cut to stamp duty announced in the government’s Growth Plan last month would be reflected in receipts from October. 

Helen Morrissey, senior pensions and retirement analyst at Hargreaves Lansdown, said although this was compared to the stamp duty holiday period, the figures were still “hugely impressive”. 

She added: “We may see these figures tail off in the coming months as people decide to put off moving home. This is particularly the case since last month when the so-called mini Budget brought chaos to the markets pushing up mortgage rates and, in some cases, putting that dream property out of people’s reach.” 

Coventry Building Society analysis confirmed with the average house price in England now at £315,965, homebuyers may still have to foot a £3,298 bill to move home. 

Jonathan Stinton, head of intermediary relationships at Coventry Building Society, said: “Stamp duty is one of the many costs worrying homebuyers. Whilst the recent changes to thresholds were a welcome addition, this should be the beginning of a wider, more holistic strategy.  

“There’s still an opportunity to help downsizers, who may currently face a hefty tax bill for moving to a smaller home, and a huge opportunity to incentivise energy-efficient home improvements. More action needs to be taken to reduce the impact existing housing stock has on carbon emissions.  This should be a priority for the new incoming Prime Minister.” 

 

Inheritance tax boosted by higher house prices 

Between April and September this year, intake from inheritance tax (IHT) totalled £3.5bn, a £400m rise on the same period last year. 

So far this year, £4.97bn has been paid towards the tax. 

Shaun Moore, tax and financial planning spokesperson at Quilter, said IHT was “steadily becoming rather lucrative for the Treasury” as higher house prices and the nil rate bands widened eligibility for the levy. 

He added: “IHT was once viewed as a tax on wealthier individuals, but the reality is that more people are now getting caught in the IHT net – partly as a result of soaring property prices.  

“The nil rate band and the residence nil rate band will remain frozen until 2026, meaning more and more people, including many families that might not consider themselves to be wealthy, could now face a hefty IHT bill due to the amount their properties have increased in value.” 

 

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