Big changes are on the horizon for Stamp Duty Land Tax (SDLT) in England. From April 1, 2025, the temporary thresholds introduced in September 2022 will revert to their previous levels, significantly impacting homebuyers across the country—especially first-time buyers. Let’s break down what’s changing, why it’s happening, and how it could affect your next move.
Why Is Stamp Duty Changing?
Back in September 2022, the UK Government temporarily raised stamp duty thresholds to make moving more affordable. This initiative aimed to stimulate the housing market, safeguard jobs in related industries, and assist first-time buyers in climbing the property ladder. Last year the new Government have announced that these thresholds would revert on March 31, 2025.
As this deadline approaches, it’s essential to understand what’s coming and how it might impact your budget.
What’s Changing in April 2025?
Here’s a quick overview of the key changes:
1. Main Residential Properties:
- The nil-rate threshold will drop from £250,000 to £125,000.
- Rates for higher property values will remain the same.
2. First-Time Buyers:
- The nil-rate threshold will fall from £425,000 to £300,000.
- The maximum purchase price eligible for First-Time Buyers’ Relief will decrease from £625,000 to £500,000.
3. Second Homes and Additional Properties:
- Additional property purchases will see an extra band added to the stamp duty thresholds, reflecting these broader changes.
Stamp Duty Rates: Now vs. 2025
Current Rates (Until March 31, 2025)
Main Residences:
| Proportion of Property Value | Rate |
| Up to £250,000 | 0% |
| £250,001 to £925,000 | 5% |
| £925,001 to £1.5 million | 10% |
| Over £1.5 million | 12% |
First-Time Buyers:
| Proportion of Property Value | Rate |
| Up to £425,000 | 0% |
| £425,001 to £625,000 | 5% |
Additional Properties:
| Proportion of Property Value | Rate |
| Up to £250,000 | 5% |
| £250,001 to £925,000 | 10% |
| £925,001 to £1.5 million | 15% |
| Over £1.5 million | 17% |
Future Rates (From April 1, 2025)
Main Residences:
| Proportion of Property Value | Rate |
| Up to £125,000 | 0% |
| £125,001 to £250,000 | 2% |
| £250,001 to £925,000 | 5% |
| £925,001 to £1.5 million | 10% |
| Over £1.5 million | 12% |
First-Time Buyers:
| Proportion of Property Value | Rate |
| Up to £300,000 | 0% |
| £300,001 to £500,000 | 5% |
Additional Properties:
| Proportion of Property Value | Rate |
| Up to £125,000 | 5% |
| £125,001 to £250,000 | 7% |
| £250,001 to £925,000 | 10% |
| £925,001 to £1.5 million | 15% |
| Over £1.5 million | 17% |
Impact on First-Time Buyers
First-time buyers are set to feel the brunt of these changes. Currently, they enjoy:
- No stamp duty on homes up to £425,000.
- Discounted rates (5%) on homes priced between £425,001 and £625,000.
From April 2025, however:
- The nil-rate threshold will shrink to £300,000.
- Discounted rates will only apply to properties priced between £300,001 and £500,000.
Example:
- Now: A first-time buyer purchasing a £400,000 home pays no stamp duty.
- From 2025: The same buyer would pay £5,000 (5% of the £100,000 exceeding £300,000).
This change could make it harder for many first-time buyers to save for their first home, further widening the affordability gap.
Plan Ahead with Our Stamp Duty Calculator
To navigate these changes, understanding your potential costs is vital. Use a Stamp Ducty Calualator to estimate how much you’ll need to budget for your next property purchase. Whether you’re a first-time buyer or an experienced homeowner, having a clear picture of these costs will help you plan effectively.
Conclusion
The 2025 stamp duty changes mark a significant shift in the housing market, increasing costs for many buyers. First-time buyers, in particular, should carefully consider how these changes will affect their plans. If you’re planning to move or purchase property soon, it’s worth acting now to take advantage of the current thresholds before they revert.
Stay informed and prepared to make the best decisions for your property journey. For more advice, updates, and tools, check out our resources and guides to navigating the housing market.