UK Stamp Duty Changes 2025: New Rates

As of April 1, 2025, changes to the UK’s Stamp Duty Land Tax (SDLT) will come into effect, impacting homebuyers across England and Northern Ireland. These adjustments will see the reversion of SDLT thresholds to pre-September 2022 levels, potentially increasing the tax burden for many purchasers.

Key Changes to Stamp Duty Rates

1. Standard Residential Purchases:
   • Current Rates (Until March 31, 2025):
     • 0% on properties up to £250,000
     • 5% on the portion between £250,001 and £925,000
     • 10% on the portion between £925,001 and £1.5 million
     • 12% on any amount above £1.5 million
   • New Rates (From April 1, 2025):
     • 0% on properties up to £125,000
     • 2% on the portion between £125,001 and £250,000
     • 5% on the portion between £250,001 and £925,000
     • 10% on the portion between £925,001 and £1.5 million
     • 12% on any amount above £1.5 million

Example: Purchasing a home valued at £295,000 before April 1, 2025, would incur an SDLT of £2,250. Post-April 1, 2025, the SDLT for the same property would rise to £4,750, resulting in an additional £2,500 in tax.

2. First-Time Buyers (FTB):
   • Current Relief (Until March 31, 2025):
     • No SDLT on properties up to £425,000
     • 5% on the portion between £425,001 and £625,000
     • No FTB relief on properties priced above £625,000 (full SDLT payable).
   • New Relief (From April 1, 2025):
     • No SDLT on properties up to £300,000
     • 5% on the portion between £300,001 and £500,000
     • No FTB relief on properties priced above £500,000

Example: A first-time buyer purchasing a property for £500,000 before April 1, 2025, would pay £3,750 in SDLT. After this date, the SDLT would increase to £10,000, an additional £6,250 in tax.

3. Additional Properties (e.g., Buy-to-Let or Second Homes):
   • Current Rates (Until March 31, 2025):
     • 5% on properties up to £250,000
     • 10% on the portion between £250,001 and £925,000
     • 15% on the portion between £925,001 and £1.5 million
     • 17% on any amount above £1.5 million
   • New Rates (From April 1, 2025):
     • 5% on properties up to £125,000
     • 7% on the portion between £125,001 and £250,000
     • 10% on the portion between £250,001 and £925,000
     • 15% on the portion between £925,001 and £1.5 million
     • 17% on any amount above £1.5 million

Example: An investor purchasing a second property for £500,000 before April 1, 2025, would pay £30,000 in SDLT. After this date, the SDLT would increase to £32,500, an additional £2,500 in tax.