Posted: 18 / 03 / 2025
Article by: Melanie Donegan, Head of Personal Tax
Stamp Duty Land Tax (SDLT), which is a tax levied on property purchases in England and Northern Ireland, is set to increase on 1 April 2025 following a period of relaxation of rates for both first and second/multi time buyers.
Current SDLT Structure to 31 March 2025
| Standard Residential Purchase | First-Time Buyers |
|---|---|
| Up to £250,000 – 0% | Up to £425,000 – 0% |
| £250,001 to £925,000 – 5% | £425,000 to £625,000 – 5% |
| £925,001 to £1,500,000 – 10% | Above £625,001 this relief is not due, standard rules apply |
| Above £1,500,001 – 12% | |
| Second Home Supplement (31 Oct 24) – 5% |
Changes Effective from 1 April 2025
| Standard Residential Purchase | First-Time Buyers |
|---|---|
| Up to £250,000 – 0% | Up to £300,000 – 0% |
| £125,001 to £250,000 – 2% | £300,001 to £500,000 – 5% |
| £250,001 to £925,000 – 5% | Above £500,001 this relief is not due, standard rules apply |
| £925,001 to £1,500,000 – 10% | |
| Above £1,500,001 – 12% | |
| Second Home Supplement – 5% |
If you are not sure how the rules affect you, you can check the stamp duty calculator here.
Implications for Homebuyers:
- Increased Tax Liability: The reduction in the nil-rate threshold means more buyers will incur higher SDLT charges. For example, purchasing a property at £300,000 will result in SDLT of £5,000 post-April 2025, compared to £2,500 under the current rates.
- First-Time Buyers: The lowered relief threshold may require first-time buyers to budget for additional SDLT costs, especially for properties priced between £500,000 and £625,000, which previously benefited from partial relief. For example, purchasing a property for £600,000 will result in SDLT of £20,000 post-April, compared to £8,750 under the current rates.
- Market Dynamics: Anticipation of these changes has led to a surge in property transactions, as buyers aim to complete purchases before the new rates take effect. This rush may contribute to short-term price increases and heightened competition in the housing market.
When is SDLT due to be paid?
The SDLT is due for payment 14 days from the date of completion. If this is paid late individuals could face a fine and interest on the amount owed.
SDLT is usually paid by the solicitors, but an individual can also pay this directly themselves either online, by cheque or by cash at many banks. It is also possible to add stamp duty to mortgages when applications are being made.
New Leasehold Sales and Transfers
There are specific rules relating to new residential leasehold properties whereby the SDLT is based on the rates above. Where the total rent over the life of the lease is more than the SDLT threshold, currently £250,000, you pay SDLT at 1% on the portion above this. Existing leases
From 1 April 2025, the threshold falls to £125,000.
Not a UK Resident?
If you are not UK Resident (not present here for at least 183 days), additional charges usually apply, and you should check the rules for your circumstances.