Angela Rayner stamp duty 'scandal' explained: What did the Deputy Prime Minister do wrong?

Angela Rayner has finally admitted she did not pay enough stamp duty on her new seaside home. The Deputy Prime Minister said she had received inaccurate tax advice on her latest purchase of an £800,000 flat in Hove, and has since referred herself to the independent adviser on ministerial standards.

But how did Ms Rayner make this mistake, and what could it mean for her political future?

What is stamp duty?

Stamp Duty Land Tax (SDLT) is a property tax paid when buying a home in England and Northern Ireland.

Rates vary depending on the price of the property and whether it is a first or additional home. As of 2025, standard rates for primary residences start at 0% for properties up to £125,000, then rise incrementally to 2% on the portion from £125,000 to £250,000, 5% on the portion from £250,001-£925,000, 10% from £925,001-£1.5 million, and 12% above that.

Buyers of additional properties, such as second homes or buy-to-lets, pay a 3% surcharge on top of these rates, meaning the effective cost can be significantly higher.

Why did Angela Rayner pay too little stamp duty?

When Ms Rayner bought the seaside flat in May, she paid around £30,000 in standard stamp duty. But, because she already effectively owned another home, she should have paid the higher second-home rate - closer to £70,000.

Property entrepreneur Harry Fenner told Express.co.uk: "When buying an additional property - be it a second home or a buy-to-let - you're hit with a 3% stamp duty surcharge on top of the standard rates. Rayner reportedly declared the Hove property as her main residence, thereby avoiding the higher second home duty - despite still owning a house."

Earlier this year, Ms Rayner transferred her share of her Ashton-under-Lyne family home into a trust set up in 2020 for her disabled son. Having removed her name from the deeds, she says she was advised she could class the Hove flat as her only dwelling.

However, tax experts said the Hove property could not be treated as her only residence because of the nature of the trust. If she or her children could still benefit from living in the Ashton house, it likely still counted as her main residence for tax purposes.

And by almost all measures, Ms Rayner's main base remains Ashton-under-Lyne. It is where her children live, where she pays council tax, and the address used for her official documents and electoral roll.

She said in her statement: "It remains my family home, as it has been for over a decade. It contains the majority of my possessions and it is where I am registered for most official and financial purposes ranging from credit cards to the dentist to the electoral roll. But most importantly, it is where my children live and have gone to school and now college, and where I regularly live while caring for them."

Explaining the move she made, Ms Rayner continued: "After I sold my stake to the trust, I bought a property in Hove in May 2025. Like many people, I used the lump sum from selling my stake in my Ashton home, which was the only property I owned and where my savings were, for the deposit on my new one.

"I obtained a mortgage to finance the rest. When purchasing 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 "allegations in the press", Ms Rayner said she sought further advice from a leading tax counsel to review that position, who later informed her that she had not been tax compliant.

She said: "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."

Mr Fenner said: "This isn't a case of dodging small print. It's about exploiting a loophole she knew, or should have known, existed - all while preaching about fairness and integrity. It reeks of double standards."

Ms Rayner has referred herself to the independent adviser on ministerial standards and admitted she even considered resigning.

Sir Keir Starmer has since backed the Deputy Prime Minister, saying he was "very proud to sit alongside" her at Wednesday's Prime Minister's Questions. He added that her move to refer herself to the independent ethics adviser was "the right thing to do".

In the Commons, Sir Keir said: "She has explained her personal circumstances in detail. She's gone over and above in setting out the details, including Mr Speaker, yesterday afternoon, asking a court to lift a confidentiality order in relation to her own son.

"I know from speaking at length to the Deputy Prime Minister just how difficult that decision was for her. But she did it to ensure that all information is in the public domain. She has now referred herself to the independent adviser. That is the right thing to do."

However, Mr Fenner warned: "This scandal isn't going away."

He continued: "For the average buyer, failing to pay the correct stamp duty would result in swift HMRC penalties. Will Rayner face the same scrutiny? More broadly, it raises serious questions about Labour's credibility on housing policy.

"If their Deputy Leader can't or won't follow the rules, why should voters trust them to fix Britain's broken property market?"