Stamp Duty Land Tax (SDLT) rates change on April 1, 2025.
Buying a house after this date could significantly increase the cost of your purchase, making it crucial to act before the changes take effect.
Before we explore the impact of the rate change, let’s remind ourselves of what SLDT is.
What is Stamp Duty Land Tax?
You must pay SDLT if you buy a property or land over a particular price in the UK.
- buy a freehold property
- buy a leasehold
- buy a property via a shared ownership scheme
- are transferred land or property for payment, for example, taking on a mortgage or buying a share in a house.
- whether you will use the land or property for residential, non-residential or mixed-use purposes
- whether you are eligible for relief or an exemption, for example, there are different rates of SLDT on residential property if:
- you’re a first-time buyer
- you already own a property and are buying an additional property
- you’re not a UK resident
The total value you pay in SDLT (also called the ‘consideration’) is typically the price you pay for the property or land.
- works or services
- debt release
- Debt transfer, including any outstanding mortgage value.
However, Stamp Duty does not apply to all real estate purchases. You don’t need to pay the taxes if the transaction is below the threshold.
The majority of thresholds will drop on April 1, 2025, meaning you could go from paying zero SDLT to several thousand pounds or more.
What are the changes?
If you buy a house after April, these changes could make your home purchase more expensive by thousands of pounds.
SLDT payments differ according to several factors, including residency status and buying purpose. A first-time buyer will pay SDLT at a different rate than someone purchasing a second property.
Zero-rate thresholds for main residences will drop from £250,000 to £125,000, and first-time homebuyer thresholds will drop from £425,000 to £300,000.
First-Time Buyers Relief (lower stamp duty rate) will drop from £625,000 to £500,000.
Those buying additional properties will pay 7% stamp duty for property values from £125,001 to £250,000, up from 5%.
For Primary Residences
In England, SLDT for primary residences will be as follows (based on freehold properties):
| Property Selling Price | Current SDLT Rate | SDLT Rate on April 1, 2025 |
| Up to £125,000 | 0% | 0% |
| £125,001 to £250,000 | 0% | 2% |
| £250,001 to £925,000 | 5% | 5% |
| £925,001 to £1.5 million | 10% | 10% |
| More than £1.5 million | 12% | 12% |
For First-Time Buyers
The changes on April 1, 2025, will dramatically impact first-time homebuyers, making home ownership out of reach for many. Stamp duty rates for first-time buyers in England will be as follows:
| Property Selling Price | Current SDLT Rate | SDLT Rate on April 1, 2025 |
| Up to £300,000 | 0% | 0% |
| £300,001 to £425,000 | 0% | 5% |
| £425,001 to £500,000 | 5% | 5% |
| £500,001 to £625,000 | 5% | 5% |
The First-Time Buyer’s Relief will change from £625,000 to £500,000. This change means first-time buyers who pay more than £500,000 for the property will not entitled to the First-time Buyer rates. Instead, you will pay the Standard Rate for Main Residences (as outlined in the first chart).
If you’re a first-time buyer purchasing a £400,000, you’re exempt from paying stamp duties until March 31, 2025. However, from April 1, 2025, you’ll pay £5,000 in stamp duties.
For additional home purchases
If you buy an additional property in England (e.g. a second home or a buy-to-let), the following thresholds apply:
| Property Selling Price | Current SDLT Rate | SDLT Rate on April 1, 2025 |
| Up to £125,000 | 5% | 5% |
| £125,001 to £250,000 | 5% | 7% |
| £250,001 to £925,000 | 10% | 10% |
| £925,001 to £1.5 million | 15% | 15% |
| More than £1.5 million | 17% | 17% |
These numbers demonstrate the importance of acting before the rates go up.
Also, note that the amount payable depends on the transaction completion date. If you agreed to the purchase before March 31, 2025, but completion does not happen until after March 31, 2025, then the increased rates will apply.
Expert Advice
Given the complexity of Stamp Duty and the potential financial impact of the upcoming changes, it’s essential to seek advice on SLDT queries from a specialist accountant. This approach will help you establish your options for making the most of any SDLT relief based on your circumstances.
Summary
The Stamp Duty Land Tax rates increase in March 2025 is a crucial consideration for anyone involved in property transactions. Taking this into account now may mean that you can save significantly on stamp duty land tax.