Homeowners pay £1.4bn in stamp duty in July and IHT intake hits £844m – HMRC

HMRC figures revealed the stamp duty intake for July was higher than the £1.2bn paid last year, while the temporarily higher thresholds were in place. 

This increase in stamp duty payments was put down to the higher rates of stamp duty on additional dwellings and a rise in transactions. 

Since the start of the tax year in April, HMRC has collected £4.7bn in stamp duty land tax, up on £4.2bn last year. 

Since January, taxpayers have paid just over £8bn in stamp duty, up from £6.6bn over the same period in 2024. 

Coventry Building Society analysed the data and found that since the nil-rate threshold lowered in April, homebuyers in nearly every region were liable to pay stamp duty on an averagely priced home. 

Sponsored

Aldermore Insights with Jon Cooper: Edition 5 – Feeling enthusiastic about next year’s run-of-the-mill market

Sponsored by Aldermore

The mutual said this put more affordable homes into the stamp duty bracket and the nil-rate threshold falling from £250,000 to £125,000 increased the average tax from £2,047 to £4,547. 

Jonathan Stinton, head of intermediary relationships at Coventry Building Society, said: “The fact that there’s now nowhere to hide from stamp duty shows just how out of step this tax has become. From London to the North East, those buying a typical home in any region are now being hit with a tax that can add thousands to the cost of moving. 

“There’s speculation of a new property tax, which would shift the burden from buyers to sellers – removing one of the biggest upfront hurdles people face – but it comes with a risk of market distortion. The prospect of reform could make buyers and sellers delay their moves while they wait for clarity. Once in force, it could reduce the supply of new homes coming onto the market, or warp house prices – with some owners trying to sell under £500,000 to stay below the threshold, and others increasing prices to offset the tax. 

“The principle is right: our property taxes should fit today’s housing market, not the one we had decades ago. But it’s vital the detail is carefully designed so we don’t swap one barrier for another.” 

IHT intake continues rising 

Some £844m was paid in inheritance tax (IHT) in July, an increase on the £749m paid during the same month last year. 

IHT receipts for the tax year starting April to July were £3.1bn, £200m more than the same period in 2024. 

HMRC said higher receipts in April could be partially attributed to a small number of higher-value payments than usual. 

Will Hale, CEO of Key Advice and Air, said 2025 looked to be a record year for IHT. 

He added: “Furthermore, announcements around the inclusion of pension funds within the IHT regime, musings around the potential for a limit to be applied on lifetime gifting and continued house price inflation means that the government is looking at death as [a] key focus for boosting public finances moving forward. 

“Many people who would fall beneath the traditional definition of ‘high-net-worth’ are now sleepwalking into a situation where their estates will be subject to significant IHT charges. It is therefore imperative that families seek specialist advice and that this advice includes a consideration of all options for reducing the IHT liability – including modern later life lending solutions such as lifetime mortgages.” 

Stephen Lowe, director at Just Group, said: “Rising asset prices, frozen thresholds and constrained public finances continue to tighten the inheritance tax net and secure increasing receipts for the Treasury. 

“This year looks set to be no different; current figures show the 2025/26 year is on course to be another record breaker – for the fifth year in a row. 

“As the Chancellor continues to feel the fiscal pressure, she will want to explore all her options ahead of the Autumn Budget. It’s likely that inheritance tax will have the slide rule run over it once more.”

He added: “With more estates being subject to inheritance tax, and the prospect of changes to the rules on the horizon, it is important people keep track of the valuation of their estate, including a recent assessment of their property wealth. 

“Estate planning is complex and difficult, so many families may find it beneficial to seek professional financial advice to understand their circumstances, the impact of the IHT regime and their options for minimising tax liabilities.”