Ipswich law firm says government unlikely to backdate stamp duty
PUBLISHED: 07:30 15 July 2020 | UPDATED: 17:29 15 July 2020
An Ipswich-based law firm said it is unlikely the coronavirus stamp duty holiday will be backdated to March, despite a growing campaign.
Last week chancellor Rishi Sunak announced that property buyers would pay no stamp duty on homes worth less than £500,000.
According to Birketts law firm, this means someone buying a house for £341,091 – the average price of a house in East Anglia – would save £7,054.
Now, a national law firm, Simpson Millar, has called on the government to backdate this tax cut to the beginning of lockdown on March 31.
Sarah Ryan, head of private client and conveyancing at the firm, said: “We of course welcome the plans announced to freeze the stamp duty costs on any property up to the value of £500,000 which will not only encourage potential buyers to move on and up the proverbial ladder, but will also help to retain jobs in the real estate sector.
“However, there is no denying that for some, in particular those individuals, couples and families who have managed to complete on the purchase of their home either during lockdown, or in the immediate aftermath, this will come as a bitter blow.”
You may also want to watch:
A petition calling for the government to backdate the holiday even further has gained nearly 10,000 signatures. If the petition reaches 10,000 signatures the government has to respond and if the petition reaches 100,000 then a debate in parliament must be considered.
But Karl Pocock, partner and head of tax at Birketts, does not think the government is likely to make this move.
He said: “Although there are calls for Rishi Sunak to backdate the reduced stamp duty rates to the start of lockdown, the Chancellor’s goal seems to be to galvanise the housing market now. As such, much as a backdated rate cut would be very welcome news for anyone that had completed on a property purchase prior to the change in stamp duty rates, it is, in our view, unlikely.
“The various residential property teams at Birketts have seen a surge in transactions as lockdown restrictions were lifted. Much of this activity was existing transactions restarting. However, we expect that the reduction in stamp duty rates will provide a further, sustained, boost to this part of the economy in the short term.
“Although lockdown restrictions continue to impact working practices, Birketts’ investment in IT systems has ensured that full service has been maintained to enable us to cope with this upturn in instructions.”
If you value what this story gives you, please consider supporting the Ipswich Star. Click the link in the orange box above for details.