Stamp duty receipts have fallen this year despite more homebuyers being pulled into paying the tax following last year’s threshold changes, analysis from Coventry Building Society reveals.
The mutual said homebuyers paid £4.3bn in Stamp Duty Land Tax during the first part of 2026 – around 6% lower than the same period last year.
The decline comes despite the nil-rate threshold reverting from £250,000 back to £125,000 on 1 April 2025, a move which significantly increased upfront costs for buyers across much of England.
Coventry said the changes pushed many more transactions into the tax bracket overnight, increasing the stamp duty bill on an average-priced home in England by £2,500.
AFFORDABILITY PRESSURES
Stamp duty for a home mover purchasing an average-priced property in England now stands at around £4,500, compared to £2,000 before the threshold changes came into force.
HMRC data also showed buyers paid £1.3bn in stamp duty during April alone, with total receipts since the threshold reduction reaching £16.4bn.
The figures suggest higher transaction taxes may now be weighing on market activity, particularly as affordability pressures and mortgage costs remain elevated.
Many lenders and brokers had previously warned that increased upfront costs could suppress buyer mobility and slow transaction volumes despite the Treasury widening the tax base.
UPFRONT COSTS
Jonathan Stinton, head of intermediary relationships at Coventry Building Society, said: “When Stamp Duty goes up, activity can slow down – because you can’t turn up the tax without taking some steam out of the market.
“For many buyers, finding thousands of pounds for upfront costs on top of deposits, legal fees, and moving costs can be enough to rethink a move.”
He warned there was a risk the Treasury could ultimately collect less tax overall if higher costs reduce transaction volumes.
Stinton added: “Bringing more homes into the tax net might seem like an easy win for the Treasury – but if higher upfront costs discourage people from moving the overall take can actually start to fall.
“There’s a risk of creating a lose-lose situation where homebuyers are paying more, but the expected boost to tax receipts doesn’t fully materialise.”
He said reforming stamp duty could help improve housing market mobility at a time when affordability pressures remain stretched across much of the UK.
