As you may be aware, it was announced in the Labour budget that they would be ending the lower Stamp Duty Land Tax (SDLT) thresholds on 1 April 2025. The lower thresholds were originally introduced by the Conservative Government in September 2022.
Any transactions which do not complete prior to 1 April 2025 will be caught by the new thresholds.
The changes coming into effect are:
- The nil rate threshold will reduce from £250,000 to £125,000. The result is that the transactions caught by this will be paying £2,500 more SDLT than if the matter had completed prior to 1 April 2025.
- The nil rate threshold for first-time buyers will reduce from £425,000 to £300,000.
- The maximum purchase price for which First-Time Buyer’s Relief can be claimed will reduce from £625,000 to £500,000.
No matter when your transaction starts, your conveyancer will be unable to guarantee that completion will take place prior to 1 April 2025, and you should therefore ensure that you budget your finances accordingly and be prepared to pay the additional SDLT if completion takes place on or after 1 April 2025.
Whilst your conveyancer will submit the SDLT return on your behalf, they are not tax specialists. Therefore, if you are in any doubt as to your liability, you should contact a specialist tax advisor.
You may also find the Government’s SDLT calculator helpful. This can be found at Stamp Duty Land Tax Calculator
SDLT after 31 March 2025
The changes in SDLT may impact you as follows:
Purchases of only property or main residence
For a buyer purchasing a property which will be their own property or a replacement of their main residence, the current rates are:
| Property or lease premium or transfer value | SDLT rate |
| Up to £250,000 | Zero |
| The next £675,000 (the portion from £250,001 to £925,000) | 5% |
| The next £575,000 (the portion from £925,001 to £1.5 million) | 10% |
| The remaining amount (the portion above £1.5 million) | 12% |
For a buyer purchasing a property which will be their own property or a replacement of their main residence, the rates for a transaction completing on or after 1 April 2025 will be:
| Property or lease premium or transfer value | SDLT rate |
| Up to £125,000 | Zero |
| The next £125,000 (the portion from £125,001 to £250,000) | 2% |
| The next £675,000 (the portion from £250,001 to £925,000) | 5% |
| The next £575,000 (the portion from £925,001 to £1.5 million) | 10% |
| The remaining amount (the portion above £1.5 million) | 12% |
Purchase of second property subject to higher rate of SDLT
A buyer purchasing a property which will result in them owning more than one property which is not a replacement of their main residence will currently pay the following rates:
| Property or lease premium or transfer value | SDLT rate |
| Up to £250,000 | 5% |
| The next £675,000 (the portion from £250,001 to £925,000) | 10% |
| The next £575,000 (the portion from £925,001 to £1.5 million) | 15% |
| The remaining amount (the portion above £1.5 million) | 17% |
A buyer purchasing a property which will result in them owning more than one property which is not a replacement of their main residence will pay the following rates on or after 1 April 2025:
| Property or lease premium or transfer value | SDLT rate |
| Up to £125,000 | 5% |
| The next £125,000 (the portion from £125,001 to £250,000) | 7% |
| The next £675,000 (the portion from £250,001 to £925,000) | 10% |
| The next £575,000 (the portion from £925,001 to £1.5 million) | 15% |
| The remaining amount (the portion above £1.5 million) | 17% |
First Time Buyers
A buyer who qualifies for first time buyer relief will currently pay the following rates:
- no SDLT up to £425,000
- 5% SDLT on the portion from £425,001 to £625,000
If the price is over £625,000, you cannot claim the relief and you will be liable for the same rates as a non-first-time buyer as discussed above.
A buyer who qualifies for first time buyer relief will pay the following rates on or after 1 April 2025:
- no SDLT up to £300,000
- 5% SDLT on the portion from £300,001 to £500,000
If the price is over £500,000, you cannot claim the relief and you will be liable for the same rates as a non-first-time buyer as discussed above.
For further information, please contact Ashton Sutcliffe, a Senior Associate in the Property team on 01626 202370 or email ashtonsutcliffe@wbw.co.uk.
WBW Solicitors has offices in Axminster, Bovey Tracey, Brixham, Chard, Exeter, Exmouth, Honiton, Launceston, Newton Abbot, Paignton, Seaton, Sidmouth, and Torquay.
This article is for general information only and does not constitute legal or professional advice. Please note that the law may have changed since this article was published.
