Last Call! Stamp Duty Changes in 2025: What Homebuyers Need to Know

If you are thinking about buying a home, there is an important tax change coming in April 2025 that could raise your costs.

The way Stamp Duty Land Tax (SDLT) is calculated will change, and this could affect how much you pay when buying a property. Here is what you need to know before making a decision.

How stamp duty works now (Until 31 March)

At the moment, most buyers pay Stamp Duty based on these rates:

• £0 – £250,000 – No tax

• £250,001 – £925,000 – 5%

• £925,001 – £1.5 million – 10%

• Over £1.5 million – 12%

If you are a first-time buyer, you get a better deal:

• No tax on homes up to £425,000

• 5% on the portion between £425,001 and £625,000

• No discount if the home costs more than £625,000

What’s changing in April?

From 1 April 2025, the tax bands will change, and some buyers will have to pay more. The new general rates will be:

• £0 – £125,000 – No tax

• £125,001 – £250,000 – 2%

• £250,001 – £925,000 – 5%

• £925,001 – £1.5 million – 10%

• Over £1.5 million – 12%

For first-time buyers, the threshold for no tax drops to £300,000, and they will pay 5% on anything between £300,001 and £500,000. If the home costs more than £500,000, they will not get any discount at all.

How this could affect you

For most homebuyers, the new rules will mean a higher upfront cost when purchasing a property. First-time buyers will lose some of their tax relief, and general buyers will start paying Stamp Duty at a lower price threshold.

If you are buying soon, it may be worth checking how much tax you could owe under the new system. Speaking to a mortgage adviser or solicitor could help you make informed decisions.

With property prices already a big challenge for many, this extra cost is something buyers need to prepare for. Whether you decide to buy before or after the changes, make sure you know what to expect and plan ahead.