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

Significant changes to Stamp Duty Land Tax (SDLT) are coming in April 2025, affecting property purchases in England and Northern Ireland. Whether you’re a first-time buyer, moving home, or investing in property, these changes will impact how much tax you’ll need to pay.  If you do want to take advantage of the current, more advantageous rates of SDLT it is important that you plan ahead and start working on your property transaction as soon as possible.

Current SDLT Rates (Until April 2025)

Currently, no stamp duty is payable on properties up to £250,000. Above this threshold, the tax operates on a tiered system:

• £250,001 – £925,000: 5%
• £925,001 – £1.5 million: 10%
• Over £1.5 million: 12%

First-time buyers enjoy relief on properties up to £625,000, paying no SDLT on the first £425,000.

Key Changes from April 2025

New Standard Rates

The tax-free threshold will decrease to £125,000, with new rate bands:

• Up to £125,000: 0%
• £125,001 – £250,000: 2%
• £250,001 – £925,000: 5%
• £925,001 – £1.5 million: 10%
• Over £1.5 million: 12%

First-Time Buyers

The relief for first-time buyers will be adjusted:

• 0% on the first £300,000
• 5% on property value between £300,001 and £500,000

Additional Properties

Buy-to-let and second home purchases will face increased surcharges:

• Up to £125,000: 5%
• £125,001 – £250,000: 7%
• £250,001 – £925,000: 10%
• £925,001 – £1.5 million: 15%
• Over £1.5 million: 17%

Preparing for the Changes

1. Budget Carefully: Calculate the new SDLT costs when planning your property purchase
2. Plan Ahead: Consider timing your purchase based on the new rates
3. Seek Professional Advice: Consult with property experts to understand how these changes affect your specific situation
4. Stay Informed: Keep track of any additional updates or amendments to the changes

These changes represent significant adjustments to the property tax landscape. If you’re planning to buy property in 2025 or beyond, factor these new rates into your budget and seek professional guidance to make informed decisions about your purchase.