{"id":6087053,"date":"2022-05-27T08:55:41","date_gmt":"2022-05-27T07:55:41","guid":{"rendered":"https:\/\/www.buyassociation.co.uk\/?p=6087053"},"modified":"2022-05-27T08:55:41","modified_gmt":"2022-05-27T07:55:41","slug":"stamp-duty-rumours-tax","status":"publish","type":"post","link":"https:\/\/www.buyassociationgroup.com\/en-au\/2022\/05\/27\/stamp-duty-rumours-tax\/","title":{"rendered":"Stamp duty rumours: is a tax shake-up on the cards?"},"content":{"rendered":"

The government could be set to pin more focus on retirement living, while a stamp duty cut for downsizers could free up under-occupied homes.<\/strong><\/p>\n

The stamp duty that the majority of buyers must pay<\/a> when purchasing UK property has long been a contentious issue in the market. Now the government could be set to readdress these issues again, which could result in another change to the tax<\/a>.<\/p>\n

At the moment, most buyers investing in property worth more than \u00a3125,000 in England must pay stamp duty<\/a>, and the percentage paid increases depending on what price bracket your property falls into. The more expensive the property<\/a>, the higher the tax.<\/p>\n

There are exceptions, such as much higher thresholds for first-time buyers<\/a>. There are also additional levies for certain purchases, including a 3% surcharge for second homes and property investments, and a 2% surcharge for non-UK residents buying UK property.<\/p>\n

The latest stamp duty rumour, which is not a new concept, is for the tax to be cut for those who are downsizing<\/a>. This would benefit older people who wish to move into more manageable homes or even retirement accommodation, while freeing up property for those lower down the ladder.<\/p>\n

How a stamp duty cut could help<\/h4>\n

The government is said to be in discussions on cutting stamp duty for those moving from large to smaller properties. According to statistics, almost 40% of properties are under-occupied with too many bedrooms for the number of people living there.<\/p>\n

By adding an incentive for older people to downsize, by saving money on stamp duty, this could free up space for younger people and families to find homes.<\/p>\n

This plan could coincide with providing more developments for retirement living, said housing secretary Chris Pincher. When peers pointed out that older people may be put off moving house due to stamp duty costs, he said the government is “keen to look at all the barriers that exist”.<\/p>\n

The idea was originally pitched to Chancellor Rishi Sunak as a ‘Help to Downsize’<\/a> scheme by top housing and pension bosses in summer 2020. They wrote a letter suggesting that these measures would be a boost to the housing market.<\/p>\n

The letter laid out some of the benefits, including helping older people to remain independent, happier and healthier for longer by providing more suitable accommodation. Another plus would be unlocking housing chains, as well as regenerating town centres.<\/p>\n

Planning reform is needed<\/h4>\n

Commenting on the stamp duty rumours and the idea of an overhaul for downsizers, Nick Sanderson, CEO at Audley Group<\/a>, said: \u201cThe crux of the issue is simply that there aren\u2019t enough housing options available for people looking to downsize.<\/p>\n

“The Treasury can throw incentives at the market as much as it pleases, but many potential downsizers have nowhere they\u2019d like to move and without changing that, how can the incentives work?”<\/p>\n

He added that the the retirement living market is “chronically underserved” and must be addressed first and foremost. “Reform planning rules to mandate age-specific housing, increase supply and only then bring in financial incentives to encourage downsizing,” he said.<\/p>\n

“It\u2019s this systematic approach that is needed if we are to provide solutions to the housing crisis. Work has started with the government underlining its commitment to more specialist retirement housing and the formation of the Housing with Care taskforce. Now planning reform has to be the very first point on the agenda.\u201d<\/p><\/blockquote>\n

Other property tax options<\/h4>\n

A new survey released by Anthony Ward Thomas<\/a> looking at attitudes towards moving found that the idea of reforming stamp duty completely is a popular one among many.<\/p>\n

First-time buyers already have a much higher threshold before they have to pay stamp duty (\u00a3300,000, with a 5% charge payable for homes priced between \u00a3300,000-\u00a3500,000 on the amount of purchase price above \u00a3300,000). But 59% of survey respondents thought first-time buyers should be exempt.<\/p>\n

A further 38% said that the tax should be replaced by capital gains tax<\/a> on all homes sales. Currently, capital gains tax is only payable by those selling second homes or investment properties.<\/p>\n

Anthony Ward Thomas, founder of Anthony Ward Thomas removals, said: \u201cFirst-time buyers are the lifeblood of the housing market and we need plenty of them to keep everything functioning smoothly further up the ladder.<\/p>\n

“However, the cost of moving is in danger of running away from them \u2013 it\u2019s not just about finding a deposit and having a big enough salary to get the mortgage you need, there are all the other moving costs, such as stamp duty.<\/p>\n

\u201cReplacing a tax on buying \u2013 stamp duty \u2013 with one on selling \u2013 CGT \u2013 makes a lot of sense. Buyers will already have profited from the increase in value of their home so paying a tax on that, rather than at the point of entry, seems much fairer.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

The government could be set to pin more focus on retirement living, while a stamp duty cut for downsizers could free up under-occupied homes. The stamp duty that the majority of buyers must pay when purchasing UK property has long been a contentious issue in the market. Now the government could be set to readdress… Read more »<\/a><\/p>\n","protected":false},"author":1069,"featured_media":14964,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[61,59,6],"tags":[520,85],"acf":[],"_links":{"self":[{"href":"https:\/\/www.buyassociationgroup.com\/en-au\/wp-json\/wp\/v2\/posts\/6087053"}],"collection":[{"href":"https:\/\/www.buyassociationgroup.com\/en-au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.buyassociationgroup.com\/en-au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-au\/wp-json\/wp\/v2\/users\/1069"}],"replies":[{"embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-au\/wp-json\/wp\/v2\/comments?post=6087053"}],"version-history":[{"count":0,"href":"https:\/\/www.buyassociationgroup.com\/en-au\/wp-json\/wp\/v2\/posts\/6087053\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-au\/wp-json\/wp\/v2\/media\/14964"}],"wp:attachment":[{"href":"https:\/\/www.buyassociationgroup.com\/en-au\/wp-json\/wp\/v2\/media?parent=6087053"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-au\/wp-json\/wp\/v2\/categories?post=6087053"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-au\/wp-json\/wp\/v2\/tags?post=6087053"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}