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Home Business Stamp duty surge cools amid market woes

Stamp duty surge cools amid market woes

by Uma Rajagopal
concentrated business women reviewing accounting report SBI 300723639 3

 

  • Overall stamp duty receipts for April 2022 to February 2023 are £18 billion.
  • This is £1.1 billion higher than in the same period a year earlier. 
  • After a strong start to the year, receipts are starting to fall as the housing market slows and stamp duty changes come into effect.
  • Inheritance tax receipts for April 2022 to February 2023 are £6.4 billion.
  • This is £0.9 billion higher than in the same period a year earlier and reflective of a long-term freeze in thresholds.
  • Income Tax and National Insurance receipts are £38.1 billion higher than in the same period a year earlier. 

HMRC has published the latest tax receipt and national insurance data HMRC tax receipts and National Insurance contributions for the UK (monthly bulletin) – GOV.UK (www.gov.uk)

Helen Morrissey, head of retirement analysis at Hargreaves Lansdown:

“Stamp duty receipts started the tax year strongly but have quickly run out of steam as the property market slows dramatically. The cost-of-living crisis has hit our budgets hard and means more people are having to shelve the prospect of buying a new home for the time being. These receipts are up to February and likely relate to sales agreed late last year as the market was starting to unwind the chaos caused by the mini-budget. Added to this, changes to stamp duty will have also had a dampening effect on receipts. We’ve seen mortgage rates come down since then, but they remain higher than many people are used to, and this will likely put them off dipping a toe in the market for now.

Tax freezes also continue to bite with inheritance tax receipts also higher than this time last year. Thresholds have been held for several years and the rise in asset values, particularly property, that we’ve seen in recent years mean more and more families are being drawn in. Far from being a rich person’s tax IHT is becoming an increasing problem for middle-England, particularly for those in the South of England where property prices tend to be higher. If you can plan for it, then that makes life easier but for those who don’t it can come as a nasty shock at a difficult time.”