Stamp Duty Changes: What You Need to Know

Stamp Duty Changes in 2025: What You Need to Know

Significant changes to Stamp Duty Land Tax (SDLT) are set to take effect on April 1, 2025. These alterations could substantially increase the cost of purchasing a home, particularly for first-time buyers. Here's what you need to know about the upcoming changes:

Understanding Stamp Duty Land Tax

SDLT is a lump sum payment made by property buyers to the government within 14 days of completing a purchase. It applies to freehold and leasehold properties, shared ownership schemes, and transferred real estate in England.

Key Changes from April 1, 2025

For Main Residences

The zero-rate threshold will drop from £250,000 to £125,000. A new 2% rate will apply to properties priced between £125,001 and £250,000.

For First-Time Buyers

The threshold for first-time buyers will decrease from £425,000 to £300,000. The First-Time Buyer's Relief will only apply to properties up to £500,000, down from £625,000.

For Additional Properties

Buyers of second homes or buy-to-let properties will face increased rates, with a new 7% rate on properties valued between £125,001 and £250,000.

Impact on Buyers

These changes could significantly increase the cost of purchasing a home. For example:

- A £250,000 property purchase will incur £2,500 in SDLT after April 2025, compared to £0 currently.

- First-time buyers purchasing a £400,000 property will pay £5,000 in SDLT after April 2025, compared to £0 currently.

Planning Ahead

To avoid these increased costs, consider completing your property purchase before April 1, 2025. Seeking assistance from a conveyancing firm can help streamline the process and ensure timely completion.

Remember to use an up-to-date Stamp Duty Land Tax Calculator to estimate your potential payments based on these upcoming changes.