Personal Pension  

Scrap stamp duty for downsizing pensioners: LV

Scrap stamp duty for downsizing pensioners: LV

LV has called on the government to scrap stamp duty costs for pensioners seeking to downsize their homes in retirement.

Research from the provider suggested a third of people approaching retirement would be ‘property pensioners’, relying on money tied up in their home to pay for their lifestyles in retirement. This compares to the 22 per cent of existing pensioners who have done the same.

The provider polled 1,500 UK over-50s, 1,200 of whom own their own home, in March.

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Downsizing is the most popular way to raise money from a property, but the average house price triggers a £4,600 stamp duty bill, according to figures from LV.

The current stamp duty land tax threshold is £125,000 for residential properties and £150,000 for non-residential land and properties.

John Perks, managing director of LV Retirement Solutions, said: “We’re calling on the Government to scrap the unfairly high stamp duty costs for downsizing pensioners and provide a much-needed injection of larger homes into the market for the millions of families struggling to move up the ladder.

“By increasing the number of property sales, this could also increase the government’s stamp duty revenues in the long run, making it a win-win for everyone.”

Stamp duty rates

Up to £125,000Zero
The next £125,000 (the portion from £125,001 to £250,000)2%
The next £675,000 (the portion from £250,001 to £925,000)5%
The next £575,000 (the portion from £925,001 to £1.5 million)10%
The remaining amount (the portion above £1.5 million)12%