Wealthy homebuyers have already found loopholes to avoid paying the top stamp duty rate, less than a month after George Osborne introduced a higher levy as the centrepiece of his Budget.
Wealthy homebuyers have already found loopholes to avoid paying the top stamp duty rate, less than a month after George Osborne introduced a higher levy as the centrepiece of his Budget.
Tax lawyers are devising schemes to help those affected by the tax – which was raised from 5 to 7 per cent on houses worth more than £2m – to get round paying it. The chancellor also closed down a popular scheme, under which properties were bought and sold via offshore corporate vehicles, by imposing punitive 15 per cent stamp duty on such structures.
One of the new avoidance schemes, marketed by a handful of London-based solicitors, involves buyers signing multiyear leases that are automatically renewed on a rolling basis. As the value of each lease is much less than the freehold of the house, the top rate of stamp duty can be circumvented.
“This is what a lot of wealthy buyers are looking at at the moment,” said one person familiar with the scheme. “Even a [long-term] lease … would drop below the £2m threshold.”
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