Clients with unoccupied property may have an opinion about the impact of stamp duty on the housing market. Some commentators have suggested that it should be replaced by an annual charge on the property. They reckon that having to find a lump sum on top of the purchase price is deterring people from climbing up the housing ladder. Cheaper houses are outside the stamp duty net but the tax adds thousands of pounds to more expensive properties. A house costing £300,000 would attract stamp duty of £9,000. From April 2011 the rate of duty on a house costing more than £1m goes up to 5%; producing a bill of £75,000 on a sale at £1.5m

The argument against an annual charge is that it might end up costing householders more in the long run; it all depends on the rate at which it was levied.

For more information about stamp duty see the revenue and customs website www.hmrc.gov.uk
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