Reform Stamp Duty to Save the UK’s Housing Sector
HMRC collected £11.6bn in stamp duty last year, but a temporary cut in 2022 drove receipts up to £17.5bn, fuelling calls for reform
David Hannah, Group Chairman of Cornerstone Tax, contends that reforming stamp duty could significantly transform the UK’s housing market
The latest research from Telegraph Money reveals several effective strategies for reducing stamp duty bills and this includes utilising exemptions for first-time buyers. Currently, first-time buyers benefit from significant exemptions with the UK’s stamp duty threshold at £425,000, but this is set to decrease to £300,000 in April 2025, reducing the number of stamp duty-free homes available. Presently, 58% of homes in England are stamp duty-free for first-time buyers, but this percentage is expected to fall sharply with the forthcoming policy change. HMRC collected £11.6bn in stamp duty receipts last year, underscoring the tax’s substantial impact on homebuyers and driving calls for reform, especially when a temporary cut drove receipts up to £17.5bn. David Hannah, Chairman of Cornerstone Tax, advocates for well-targeted reform, arguing that it could stimulate the property market. Stamp duty often deters people from moving, whether for work or to upsize, and limits options for those looking to downsize.
Research by Cornerstone Tax shows that 44% of people feel priced out of their desired locations due to rising house prices, with Hannah stating that maintaining current stamp duty thresholds would invigorate the property market and the national economy. With homes valued at £450,000 or less exempt from stamp duty and those between £450,000 and £925,000 facing a 5% levy, the thresholds are overdue for a review. Adjusting these bands would not only benefit first-time buyers but also aid pensioners looking to move up the property ladder. This increased demand for mid-to-high-end properties could have a positive ripple effect, boosting sales and energising Britain’s stagnant housing market.
David Hannah, Group Chairman of Cornerstone Tax, comments:
“SDLT payment bands have been long overdue for an overhaul as they have never been index-linked to house price inflation. An increase in these thresholds would stimulate activity at the lower end of the property market and allow first-time buyers to reduce the amount they need to borrow, thus improving their affordability calculations. Furthermore, creating an exemption for pensioners would allow more Brits to downsize freeing up homes for those wishing to get onto the property market.
“As we all know, a rising tide lifts all boats, those looking to purchase properties on the mid-to-high end of the property market will now have a chance to sell their low-end properties as a result of the increase in demand from prospective buyers, contributing to further momentum within the housing market.”
You May Also Enjoy
Households facing £114 council tax increase
UK House Price Index for January 2025
Exchange time reaches 135 days
Industry response to latest inflation figures and its impact on housing
Foxtons Lettings Market Index – February 2026
