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Stamp Duty Land Tax (SDLT) Changes: What Homebuyers Need to Know Before April 2025

A photo of April Ford
4th February 2025

Stamp Duty Land Tax (SDLT) is a tax paid when purchasing a property or land in England and Northern Ireland. It applies to both Freehold and Leasehold properties. SDLT varies on the property’s price, whether the buyer is a first-time buyer, whether the purchaser is a UK resident, and whether the property is a second home or investment property. 

You must pay SDLT when buying:

  • Residential property above £250,000 (or £425,000 for first time buyers); or 
  • Non residential property or land above £150,000.

On 23rd September 2022, the former Chancellor announced a cut to SDLT as part of the Government's mini-budget. The aim was to stimulate economic growth by making home purchases more affordable, therefore boosting the property market and to help first time buyers by reducing up front costs. In the Autumn statement released in November 2022, the Chancellor announced that the SDLT cuts would be temporary and it was confirmed that the SDLT “holiday” would end on 31st March 2025. The deadline has come around so quickly and many clients are keen to meet the deadline to avoid any further costs in their transaction. If you are in the process of purchasing a property, or thinking of purchasing a property this year, it is important to understand these changes which have been set out below:

Current SDLT rates (until 31st March 2025)

First Time Buyers:

  • 0% on properties up to £425,000
  • 5% on the portion between £425,001 and £625,000
  • No relief on properties over £625,000

Other Buyers:

  • 0% on properties up to £250,000
  • 5% on the portion between £250,001 and £925,000
  • 10% on the portion between £925,001 and £1.5 million
  • 12% on any amount above £1.5 million 

Changes effective from 1st April 2025:

First Time Buyers

  • The nil rate threshold decreases to £300,000
  • 5% on the portion between £300,001 and £500,000
  • No relief on properties over £500,000

Other Buyers:

  • The nil rate threshold reverts to £125,000
  • 2% on the portion between £125,001 and £250,000
  • 5% on the portion between £250,001 and £925,000
  • 10% on the portion between £925,001 and £1.5million
  • 12% on any amount above £1.5million

The changes mean that completing a property purchase after 31st March 2025 will result in a significant increase in SDLT payable in a transaction. For example, if a first-time buyer purchases a home for £350,000 and completes before the deadline, they would pay no SDLT. However, if they complete on 1st April 2025, this would incur a £2,500 liability. If you are in the process of purchasing a property, it is important to understand the upcoming changes and take time to explore the financial implications if there is a risk that your transaction could extend beyond 31st March 2025 and you have not accounted for the changes. 

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Our blogs and articles are not meant to serve as legal advice for any specific issue. The author assumes no responsibility for the accuracy of the content or any consequences that may arise from relying on it.