Angela Rayner Stamp Duty Case: The Importance of Getting the Right Advice

Deputy Prime Minister and Housing Secretary Angela Rayner has acknowledged that she underpaid Stamp Duty Land Tax on the purchase of her £800,000 flat in Hove, East Sussex. The underpayment stemmed from arrangements involving her former family home in Greater Manchester, which – under tax regulations – should have triggered the higher rate typically applied to additional property purchases.

Rayner denied any deliberate attempt to avoid the surcharge, attributing the error to initial legal advice that, she said, failed to “properly take account” of her circumstances.* Reports suggest she saved approximately £40,000 by not paying the higher rate reserved for second homes.

Following her divorce, a portion of her interest in the Greater Manchester property had been transferred to a court-instructed trust established to support the long-term care of her son, who lives with lifelong disabilities. However, updated legal guidance later revealed that “complex deeming provisions” within the trust meant she remained liable for the higher stamp duty rate on the Hove flat.

What is the situation with Stamp Duty and Second Homes?

If you’re planning to purchase a second property in the UK, please be aware that you’ll incur an additional Stamp Duty Land Tax (SDLT) surcharge. Unlike buying your first home, where no Stamp Duty is charged on the portion of the price between £0 and £125,000, you’ll need to pay an additional rate on top of the standard rates for second homes.

For example, this means that for the £0–£125,000 bracket, you’ll be charged 5% instead of 0%.

If you sell your main residence within three years of buying the second property, you may be eligible for a refund of the additional surcharge. HMRC offers this relief to help those transitioning between homes.

For detailed information on exemptions and reliefs, visit the official UK Government website. However, we strongly recommend consulting a qualified tax advisor to ensure you understand your obligations and opportunities for reclaiming any overpaid tax.

*Rayner says she has now contacted HMRC to work out the tax she needs to pay and referred herself for investigation by the PM’s standards adviser.

Additional Resource: What the Angela Rayner case teaches us about personal injury trusts