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An occasional series of thoughts by our contributors. JOHN JEFFREY-COOK takes up residence in Number 11 for a day
It is hardly believable that an increase of £1 in the consideration can increase the amount of stamp duty land tax by £1 250 £5 000 or even £10 000. Yet this is the case because of the progressive rates and the absence of any relief to smooth the transition from one slab to another.
Ignoring first-time buyers and designated disadvantaged areas the rate on residential property is nil on £125 000 or less and 1% on £125 001: FA 2003 s 55. The duty therefore jumps from nil to £1 250.
Even greater jumps occur at £250 000: 1% to 3% or £5 000 and at £500 000: 3% to 4% again £5 000. If the rate in FA 2010 s 7 comes into force on 6 April 2011 the jump at £1 000...
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