Property News

Monday, March 05, 2007

1 in 5 now paying 3% stamp duty

Latest research from the Halifax shows that nearly a fifth of all homebuyers are forced to pay stamp duty at the higher rates.

Halifax said the number of home sales in England and Wales above £250,000 has risen almost fourfold in the past five years. It means the number of residential property sales attracting at least 3% tax has increased from 73,403 in 2001 to 279,408 in 2006. According to Halifax research, the number of homebuyers on the higher rate of stamp duty rose to 19% in 2006, up from 6% in 2001.

Total revenue from the tax on property sales was roughly £4.6 in the 2005/06 tax year, up 114% from 2000/01 figures. Stamp duty kicks in on house sales above £125,000 at which it is levied at 1%. This rises to 3% for properties over £250,000 and 4% for properties over £500,000.

In the 2005/06 tax year, the higher rates accounted for 74% of total residential stamp duty revenue. Research from the lender estimates that 3.5 million English and Welsh properties are now valued above the £250,000 threshold, with 600,000 liable for the highest 4% rate.

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