Historically, first-time buyers (FTBs) have benefitted from a discount or exemption in order to assist the purchase of their first home. However, increases to stamp duty announced in the government's Autumn Budget could pose a challenge to those looking to get onto the property ladder.
From 1 April 2025 Stamp Duty Land Tax (SDLT) rates are changing, with the temporary increases to the thresholds at which stamp duty applies that were introduced in September 2022 coming to an end.
SDLT is a tax that is paid when purchasing a property in England and Northern Ireland. The amount of stamp duty charged depends on the property's purchase price.
The nil-rate threshold for FTBs currently – which is in place until 31 March 2025 – applies to properties up to the value of £425,000. Homes valued between £425,001 and £625,000 have a reduced rate of SDLT of 5% for FTBs.
The nil-rate threshold for FTBs will return to the previous level of £300,000, with the maximum purchase price at which FTBs can receive a reduced SDLT rate also returning to its previous level of £500,000.
To avoid the incoming changes, you will need to have exchanged contracts, completed the purchase, and moved into your new home by 31 March 2025.
Even though this deadline may seem a long way away, the property market can move quite quickly.
So while there is a window for those committed to moving to make some potential savings by taking advantage of the current stamp duty rates, those looking longer term will need to factor in the changes and what the revised thresholds will mean for their budgets.
Stamp Duty calculator (England and Northern Ireland)
Land and Buildings Transaction Tax calculator (Scotland only)
Land Transaction Tax – introduction (Wales only, via Welsh Government)
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