Stamp Duty Land Tax Changes for Property in 2025: What You Need to Know

Temporary Stamp Duty Land Tax reductions introduced in 2022 end on 31 March 2025, with rates returning to their previous levels from 1 April 2025. Greenslade Taylor Hunt reports that many clients are now trying to complete before the deadline, and explains what is changing. SDLT is the government tax charged on property purchases in the UK on completion.

For main residences, the nil-rate threshold falls from £250,000 to £125,000, so the portion between £125,001 and £250,000 will be taxed at 2% instead of 0%. Higher bands are unchanged: 5% up to £925,000, 10% up to £1.5 million and 12% above that. On a £350,000 home, the bill rises from £5,000 to £7,500, an extra £2,500.

For first-time buyers, the nil-rate threshold drops from £425,000 to £300,000, with 5% payable on the next £200,000, and the maximum price eligible for relief falls from £625,000 to £500,000. A first-time buyer purchasing at £350,000 would pay £2,500 after 1 April instead of nothing.

To qualify as a first-time buyer, a person must be buying their only or main home and must never have owned a freehold or leasehold interest in a residential property anywhere in the world. Inheriting even part of a property removes eligibility, and when buying jointly, every buyer must meet the criteria.

Second homes and buy-to-let purchases usually carry an extra 5% charge. Someone replacing their main home avoids this, but if the old home has not been sold by the time the new purchase completes, the higher rates apply, with a refund available if the previous main home is sold within 36 months.

The firm advises buyers to stay informed and start the process early. Although mortgage arrangements can sometimes be sped up, property chains and solicitors' workloads can still delay completion, so clear communication between all parties is important.

Source: Greenslade Taylor Hunt, original article (24 January 2025)