Stamp duty reform – August 2025 update
TheHub@Druce- •
- 28 Aug 2025
Stamp duty reform – August 2025 update
What’s being considered
- Annual seller tax instead of stamp duty:
Buyers currently pay a one-off stamp duty when purchasing. Under the proposal, sellers of homes valued above £500,000 would instead face an annual property levy of around 0.54% on the portion above the threshold. - Regional impact:
Roughly 30% of homes in England exceed £500,000, but the figure rises to 59% in London, compared with only 8% in the North East. - Council tax reform:
Ministers are also exploring whether council tax could be scrapped and replaced with a local property-based charge in the future—though this is seen as a longer-term idea, unlikely before the next Parliament. - Status (August 2025):
These remain proposals under review. Policy detail and timing are still unconfirmed. Industry voices, including Rightmove’s CEO, have urged the government to carefully assess the impact before any announcement.
Worked Example – Buyer vs Seller
Scenario (Aug 2025) | Current System (Stamp Duty) | Proposed System (Annual Seller Tax 0.54%) |
| Home price: £650,000 | Buyer pays ~£22,500 upfront in stamp duty | Seller pays annually: (£650,000 − £500,000) × 0.54% = £810/year |
| Impact | Big one-off cost for buyers, upfront affordability challenge | Lower yearly outflow, but long-term payments may influence asking prices |
As of August 2025, there is still no confirmed change to stamp duty, and buyers remain liable under the existing system. However, with the government openly considering a shift toward an annual seller-based levy, the debate over fairness and affordability is intensifying. High-value regions such as London would feel the greatest impact, while buyers and sellers nationwide may begin to adjust their expectations. Whether these reforms are adopted in full or reshaped in the coming months, they signal a clear willingness by policymakers to rethink how property transactions are taxed in the UK.
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