Gov’t announces U-turn on hike in Stamp Duty on "granny flats"
Following pressure from the former Tory Cabinet Minister, Sir Eric Pickles and retirement specialists Saga, the Government have announced a u-turn on the hike in Stamp Duty that would have seen granny annexes taxed as second homes.
Whilst the tax hike announced in the 2016 budget was intended for those buying a second home, it soon became clear that an unintended consequence of the change was that many homeowners would see stamp duty on any granny flat being taxed in the same way.
The former minister was behind a Whitehall policy to encourage more pensioners to move into 'granny flats' and called for urgent clarification on the subject. Saga immediately reacted to the news slamming government for what he said he hoped was a politics of 'cock-up as opposed to a policy of design.
Following vigorous campaigning, treasury minister David Gauke confirmed yesterday that "annexes to main houses which could be used by elderly relatives will not be classed as a second home and so will not be subject to the three percentage point increase on stamp duty (SDLT)
announced in the Budget. The Finance Bill, which enacts much of the Budget, will be amended to reflect the changes."
The news will be welcomed by the estimated 33,000 owners of homes with Granny Annexes. Reacting to the government u-turn Saga's director of communications Paul Green said "This is a victory for common sense, Saga voiced concerns on behalf of worried over 50s and we are glad the Government have listened. The Chancellor is right to act to ensure that families can be confident that they wont be penalised for doing the right thing and looking after their parents at home."
