What is Stamp Duty?

Stamp Duty Land Tax (SDLT) is a mandatory tax that applies when purchasing property or land in England and Northern Ireland. You’re required to pay SDLT on residential properties with a value exceeding £250,000.

However, first-time buyers benefit from special reliefs. They pay no SDLT on homes priced up to £425,000 and receive a reduced rate on properties valued between £425,001 and £625,000.

This tax applies to both freehold and leasehold transactions, whether the property is bought outright or with the help of a mortgage.

• In Scotland, instead of SDLT, you’ll pay the Land and Buildings Transaction Tax (LBTT).
• In Wales, property buyers are subject to Land Transaction Tax (LTT) for sales completed on or after 1st April 2018.

The exact tax you’ll pay varies depending on the property’s value and your specific circumstances, making it essential to understand the rates and thresholds before finalising any purchase.

The New Measure

From March 31^st 2025 there are several Stamp Duty changes coming into effect:

• The nil rate threshold which is currently £250,000 will return to the previous level of £125,00.
• The nil rate threshold for first-time buyers which is currently £425,000 will return to the previous level of £300,000.
• The maximum purchase price for which First-Time Buyers Relief can be claimed is currently £625,000 and will return to the previous level of £500,000.

Current Stamp Duty Rates

*Note that if you’re buying a second property, you will have to pay an extra 3% in Stamp Duty on top of the standard rates set out above.

Use the SDLT calculator or check the higher rates to work out how much tax you’ll pay.

Stamp Duty Rates After March 31^st 2025

How The New SDLT Will Affect First-Time Buyers

The new Stamp Duty changes will likely have the most impact on first-time buyers and it could make it even harder for some first-time buyers to get onto the property ladder.

The changes to Stamp Duty Land Tax (SDLT) in 2025 could impact first-time buyers in several ways:

1. Lower Tax-Free Threshold: The nil-rate threshold for first-time buyers will drop from £425,000 to £300,000. This means first-time buyers will have to start paying Stamp Duty on homes priced above £300,000, instead of the current £425,000.

2. Smaller Maximum Purchase Price for Relief: The maximum home value for which first-time buyers can claim relief will decrease from £625,000 to £500,000. If a property costs more than £500,000, first-time buyers won’t qualify for any relief and will need to pay standard Stamp Duty rates.

3. Higher Overall Costs: For homes priced above these new thresholds, first-time buyers will face higher upfront costs, making it more expensive to get on the property ladder.

In summary, the 2025 changes will reduce the tax breaks available, leading to higher Stamp Duty payments for many first-time buyers.

The Deadline

To avoid the new Stamp Duty Land Tax (SDLT) changes, you must ensure that all searches are conducted, enquiries are raised and answered, and all paperwork is finalised, with a completion date set before 31st March. This means you need to have exchanged contracts, completed the purchase, and moved into your new home by this date.

Any delays in these steps—such as legal checks, mortgage approval, or property surveys could push the completion beyond the deadline, making you subject to any new SDLT rules. Acting promptly and maintaining close communication with your solicitor, estate agent, and lender is crucial to meeting this deadline.

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