Close to all (99 percent) of residential properties in London will be subject to stamp duty by 2018 and there will be a significant rise in owners paying higher taxes, according to the TaxPayers alliance, a British pressure group.
Owners of homes valued at over £125,000 (S$249,649) need to pay a stamp duty equivalent of one percent of their property’s value, while properties worth between £250,000 (S$499,297) and £500,000 (S$998,595) are subject to a three percent tax.
The government also imposed a four percent stamp duty on houses worth more than £500,000 (S$998,595) to £1 million (S$2 million), a five percent tax on units valued at over £1 million (S$2 million) to £2 million (S$4 million), and seven percent for homes costing more than £2 million (S$4 million).
The TaxPayers alliance claimed that over the next five years, nine out of ten homes in most areas of London will be subject to a three percent stamp duty or higher.
These include Barnet, Fulham, Chelsea, Lambeth, Kingston, Hackney, Islington, Camden, Richmond, Kensington, Wandsworth, Westminster, Hammersmith, Tower Hamlets and the City of London.
“Even the most affordable parts of London will see the majority of their homes paying this three percent rate,” said Eleanor McGrath of the TaxPayers alliance.
“When it (stamp duty) was brought in initially, it was previously reserved for the most expensive properties, so it is a serious issue and it’s holding a lot of people back from trying to get on the ladder, especially in London where house prices are so expensive,” added McGrath.
Nikki De Guzman, Junior Journalist at PropertyGuru, edited this story. To contact her about this or other stories email nikki@propertyguru.com.sg
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