Not only have the country’s tax receipts returned to expected levels, there have also been more than half a million (511,140) residential property transactions in the last four months to 31 May 2021. Not even the race to beat the 3% Stamp Duty surcharge for second properties (four months to 31 March 2016 – 460,400) had so many property transactions in such a short space of time and the last time that it occurred was in the four months to 31 December 2007 (504,190).
In fact, the total for the last 12 months is 1.3m residential property transactions, 22.7% (243,790) up on the 12 months to 31 May 2020. Clearly the Stamp Duty Land Tax (SDLT) holiday, a year of being trapped in the same four walls, and a new vision of the future of work arrangements meaning the need for space for a home office and not necessarily needing to being in such close proximity to your employer, has had a huge impact on this.
We expect that June’s results will push this figure even higher as the last transactions squeeze in before the 30 June 2021 deadline. Meanwhile, SDLT in those four months was £3.6b.
Total HMRC receipts in the last 12 months to 31 May 2021 are at £630b, which exceed pre-pandemic receipts for the same 12 months to 31 May 2019 (£624b). The 12 months in between (to 31 May 2020) had seen the total receipts fall to £588b.
It is positive that receipts are beginning to bounce-back and being fuelled by increases in Income Tax and National Insurance Contribution (NIC) receipts. However, there’s a long way to go to regain the billions of aid pledged in the pandemic, and the Government will want to carefully consider its next move on tax reform.
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