Deputy Prime Minister Angela Rayner has disclosed she underpaid stamp duty on a seaside flat, prompting one tax expert to label the property levy a “confusing mess”.
Ms Rayner’s admission follows mounting pressure and media reports claiming she saved £40,000 on the Hove property by removing her name from the deeds of a family home in her Ashton-under-Lyne constituency.
Ms Rayner said she bought the Hove flat after selling her stake in another home to her son’s trust. She maintained she initially believed, based on legal advice, she was liable for the standard rate of stamp duty.
However, she was later advised that, despite not owning any other property at the time of the purchase, “complex provisions relating to the trust gives rise to additional stamp duty liabilities”.
The incident highlights the intricate nature of stamp duty, which applies in “slabs”, with home buyers paying increasing portions of the property price when purchasing a residential property.
Stamp duty is charged in England and Northern Ireland. Scotland and Wales apply separate property taxes.
Housing market experts have stressed the critical importance of home-buyers taking specialist advice and meticulously double-checking paperwork to understand their obligations.
For example, the current “nil rate” band for a home-mover purchasing a property as their only home is £125,000, having recently been reduced from a higher threshold of £250,000 from April 2025.
Home-buyers usually have to pay 5 per cent on top of stamp duty rates if buying a new residential property means that they will own more than one.
However, in some cases, buyers may not have to pay the extra 5 per cent if they are replacing their main home and selling their previous one.
Posting on X, Dan Neidle, founder of Tax Policy Associates, said that in situations where people are buying a house and “everything is simple, you can ask your conveyancer how much stamp duty to pay”.
But he said that in complex situations “this is a very bad idea”.
Mr Neidle added: “The bigger point: stamp duty is a confusing mess. The tax shouldn’t exist. The second home surcharge is daft.
“Why are we taxing someone who buys two £500k homes £55k (£15k + £40k), But someone who buys one £1m home £43k? Where’s the logic?”
Property expert and TV presenter Kirstie Allsopp posted on X: “I’ve always wanted everyone to understand that the so called 2nd home surcharge is a vicious little tax which catches people at the some of the most difficult stages of their life (sic).
“If Angela Rayner didn’t understand how it worked then how are the rest of us supposed to?”
David Hollingworth, an associate director at L&C Mortgages, said that trust arrangements are not something that most home-buyers would need to factor into their situations.
Speaking generally about stamp duty, Mr Hollingworth said: “Stamp duty land tax has only become more complicated with the surcharge on additional property, so taking specialist tax advice becomes all the more important.
“The more complex the situation the more specialist that advice will likely need to be.”
Nathan Emerson, chief executive at property professionals’ body Propertymark, said: “Buying and selling property consistently ranks as both a stressful process but also one that constantly evolves, with many people being infrequently involved in it.
“In practice, understanding what tax might be due when purchasing a property will likely be unfamiliar to many people.”
He continued: “Any amount due will be truly individual and can vary based on many aspects, such as whether you are a first-time buyer, the price of the property being purchased, or if you are maybe purchasing an additional property, for example.
“You must ensure that you double-check all submitted paperwork and that all figures stated are correct and represent the true picture.
“Within this process, it is always advisable to consider professional advice and fully understand what might be due before submitting all relevant information.”
In a statement, Ms Rayner, who was divorced in 2023, said she had agreed to a “nesting arrangement” where the children remained in the family home.
She said a court-instructed trust was established in 2020 “following a deeply personal and distressing incident involving my son as a premature baby”.
The statement continued: “He was left with life-long disabilities, and the trust was established to manage the award on his behalf – a standard practice in circumstances like ours.
“To ensure he continued to have stability in the family home, which had been adapted for his needs, we agreed that our interest in the family home would be transferred to this court-instructed trust of which he is the sole beneficiary.
“Some of the interest in our family home was transferred to the trust in 2023.”
In January 2025, Ms Rayner said she sold the remaining interest in the property to her son’s trust.
The statement said: “We transferred the property because it was in the best interests of our child. I acted as any parent would.
“The sale of the property in Ashton-under-Lyne to the trust has not altered my family life. It remains my family home, as it has been for over a decade.”
After selling her stake to the trust, Ms Rayner said she bought the Hove property in May 2025, using the lump sum from selling her stake in her Ashton home, “which was the only property I owned and where my savings were”, for the deposit on my new one.
She said she obtained a mortgage to finance the rest.
Ms Rayner said that, when buying the property: “My understanding, on advice from lawyers, was that my circumstances meant I was liable for the standard rate of stamp duty.
“However, given the recent allegations in the press I have subsequently sought further advice from a leading tax counsel to review that position and to ensure I am fully compliant with all tax provisions.
“I have now been advised that although I did not own any other property at the time of the purchase, the application of complex deeming provisions which relate to my son’s trust gives rise to additional stamp duty liabilities.
“I acknowledge that due to my reliance on advice from lawyers which did not properly take account of these provisions, I did not pay the appropriate stamp duty at the time of the purchase.”
Ms Rayner said she is working with lawyers and with HM Revenue and Customs to resolve the matter “and pay what is due”.
