Changes to stamp duty set for April 2025

From 1st April 2025, significant changes to Stamp Duty Land Tax (SDLT) will take effect as the temporary thresholds introduced in September 2022 come to an end. These adjustments are expected to have a notable impact on property buyers, particularly those purchasing their first home.

Under the current rules, first-time buyers enjoy an exemption from stamp duty on homes valued up to £425,000. However, from April 2025, this threshold will drop to £300,000, meaning that first-time buyers purchasing a property at this price point will now face a £6,250 tax bill.

Additionally, the upper limit for properties eligible for first-time buyer relief will decrease from £625,000 to £500,000. From April 2025, first-time buyers purchasing properties between £300,000 and £500,000 will pay 5% stamp duty on the portion above £300,000.

This represents a substantial reduction in relief. For comparison, under the current system, no tax is paid on properties up to £425,000, and a discounted rate of 5% applies to the portion between £425,001 and £625,000.

These changes are likely to create new challenges for first-time buyers, making it potentially more difficult to enter the property market. Buyers planning to take advantage of the current rates are encouraged to act before the changes take effect.