A Cheshire-based conveyancing specialist insists that there are “no free lunches” when it comes to stamp duty land tax as the property world gears up for the ‘Boxing Day bounce’.
Chancellor Rachel Reeves was reportedly considering abolishing the tax for owner-occupied homes and replacing it with a new national property tax ahead of the recent autumn budget.
These calls were made to reduce barriers to homeownership and freeing up housing stock, with first-time buyers in-line to benefit the most from lower upfront costs.
It remains in place, however, as the market heads towards the post-Christmas rush when property searches can surge by 50 per cent or more.
Chris Illingworth, partner and head of the conveyancing department at Watsons Solicitors, believes that whilst the levy is an obstacle to people moving, scrapping it could create problems of a different kind.
Chris, who has more than 20 years of property law experience, said: “The stamp duty point is always a conundrum. No one wants to pay, but they accept it.
“I would personally support removal of stamp duty on main residences, or at least a reduction in the rates paid, but as the tax is a self-reporting one, the risk of people falsely declaring main residence status would be massive.
“Any cut in revenue from the tax would just have to be collected elsewhere. There are no free lunches.”
Alongside the continuation of stamp duty, the budget introduced the high value council tax surcharge, also known as ‘mansion tax’, set to come into effect by April 2028.
It means that properties in England worth £2 million and above will pay an additional £2,500 to £7,500 per annum depending on their market value.
Chris added: “The high property council tax surcharge seems to be a sensible way of trying to bring in some additional revenue but given the relatively small amounts expected to be collected, it could well be more political posturing.
“For example, £2,500 over the year is around £200 a month in charges, so it’s unlikely to challenge those with the income to support a £2m-plus home.
“There will always be exceptions of property rich / cash poor people, but they do have the option to downsize if finances are unsuitably stretched.
“It may even help to free up some of the homes at the upper end of the market where couples or individuals remain in properties that were family homes, but the kids have long since flown the nest.”
To speak to someone at Watsons Solicitors about buying, selling, or refinancing property, please contact enquiries@watsonssolicitors.com or call 01925 571 212.
Watsons Solicitors, which has been established for more than 60 years, specialises in family law, employment law, wills and probate, and conveyancing.
The team of experienced solicitors holds various accreditations and memberships of professional bodies relevant to their expertise, while the firm’s partners oversee all areas of work.