Angela Rayner admits underpaying tax on £800k flat

Angela Rayner has acknowledged for the first time that she had not paid enough stamp duty when she bought an £800,000 flat in Hove earlier this summer.

But how was the mistake made, and what does it mean for her political future? We look at six questions that remain outstanding regarding the deputy prime minister’s finances and position in the cabinet.

Why did she not pay enough tax on her Hove flat?

When she bought the £800,000 property in May, she paid the standard rate of stamp duty, estimated to be £30,000, rather than the higher rate for second homes, which would have been as much as £70,000.

She says the reason she did so was that she had in January put her stake in her constituency home in Greater Manchester into a trust, with her children as the beneficiaries. Because she had removed her name from the deed of the house, she was advised that she no longer counted as the owner of the property and therefore could classify the Hove flat as her only dwelling.

Tax experts say, however, that stamp duty law is more complicated than that. If the terms of the trust were such that she or her children could live in the Greater Manchester property for the rest of their lives, it still would be likely to count as her main home for tax reasons.

Where is Rayner’s main home?

Ashton-under-Lyne. The deputy prime minister counts her constituency home as her primary property for council tax reasons. It is where her children live, and it is where she lives when she is in the constituency.

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.”

Rayner has another property she spends time in, too – a grace-and-favour apartment in Admiralty House on Whitehall. She neither owns this nor pays council tax on it.

This is one reason some have accused her of hypocrisy. For almost everything, Rayner counts the Ashton home as her main property. For stamp duty reasons only, the Hove flat took precedence.

Where did she get the money for the Hove flat?

Rayner says she sold her stake in the Greater Manchester home to the trust in January 2025, which gave her the money to buy the Hove flat, which she owns with a mortgage.

The trust was set up in 2020 using a payment that was granted after a “deeply personal and distressing incident involving my son as a premature baby.”

A spokesperson confirmed on Wednesday that the cash used to buy the Hove flat originally came from that payout. The trust now holds equity in the Ashton house instead.

What are her family arrangements?

Rayner has two sons with her former husband, Mark, and one from an earlier relationship when she was 16.

She and Mark divorced in 2023 and decided to “nest” – moving in and out of the house in turn while their children remained in it. At that point, the pair put the house partly in the trust, with them and the law firm Shoosmiths as trustees.

In January, Rayner says, she sold her remaining part of the Ashton house to the trust, removing her name from the deeds in the process. In May, she used the money to buy the Hove flat, where she spent part of her summer holiday.

Why did she not say more about this before?

Rayner says she was under a court order not to divulge details of the trust and so felt unable to go into detail about her personal financial arrangements. The deputy prime minister said she was released from that order on Tuesday night, prompting the full statement on Wednesday.

What does her political future look like now?

Rayner has previously had a turbulent relationship with the prime minister, Keir Starmer, who tried to sack her during one reshuffle while in opposition. More recently, the pair have become much closer, and Starmer gave his deputy his full backing in an interview this week.

“Angela is an incredible person [and] deputy prime minister,” he told BBC Radio 5 Live.

But he has a reputation for ruthlessness, especially if he feels he has not been told the full truth about a minister’s circumstances.

The Conservatives are likely to be in full cry after the revelations about Rayner’s tax arrangements, not least because Labour is preparing to increase property taxes in the budget. The deputy prime minister’s future now depends on whether Starmer decides he can withstand such an onslaught.`