News

Tuesday 11th February 2025

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

To stimulate the housing market following the pandemic, in September 2022, the then Conservative Government introduced a temporary “stamp duty holiday,” allowing buyers to save thousands of pounds when purchasing a new home. This initiative made homeownership more affordable, particularly for first-time buyers and those upsizing. However, the “stamp duty holiday” is set to end on 31st March 2025.

What Are the Key Changes to the Stamp Duty Land Tax?
In the Autumn Budget, several adjustments to SDLT were announced, effective from 1st April 2025.

Reduction in the Nil Rate Threshold
The nil rate threshold, currently set at £250,000, will be reduced to £125,000. This means that stamp duty will again apply to property purchases valued above £125,000.

The tables below outline the current and future SDLT rates for main residences:
Current SDLT Rates for Main Residences:

Proportion of property value	Rate for Main Residence
Up to £250,000	0%
£250,001 to £925,000	5%
£925,001 to £1.5 million	10%
Over £1.5 million	12%

From 1st April 2025, the stamp duty rates will be:

Proportion of property value	Rate for Main Residence
Up to £125,000	0%
£125,001 to £250,000	2%
£250,001 to £925,000	5%
£925,001 to £1.5 million	10%
Over £1.5 million	12%

Current First-Time Buyer stamp duty rates:

Proportion of property value	Rate for First-Time Buyers
Up to £425,00	0%
£425,001 to £625,000	5%

First-Time Buyer stamp duty rates from 1st April 2025:

Proportion of property value	Rate for First-Time Buyers
Up to £300,000	0%
£300,001 to £500,000	5%

Therefore, there will be no SDLT to pay if the purchase price is up to £300,000. These changes are likely to have the most impact on First-Time Buyers. By reducing the nil rate threshold and by reducing the maximum purchase price on which First-Time Buyers relief can be claimed, it could be even more difficult for some First-Time Buyers to get themselves on the property ladder.

Changes for Investors/Second Homeowners
With the recent increase in the SDLT surcharge to 5% from 3%, investors and those purchasing a second home will need to adjust their budgets. The surcharge applies to all additional residential properties bought by an individual, including investment properties, second homes, or holiday properties. It’s crucial to understand how this will affect your finances before making your next property purchase.

Jodie Everard, Head of Residential Conveyancing at Rundlewalker says: "As we approach the changes to Stamp Duty Land Tax set to take effect on 1st April 2025, it's crucial for clients to understand that the purpose of this article is not to encourage a rush for completion by the deadline, but to prepare everyone for the inevitable adjustments ahead. We urge clients to focus on informed decision-making rather than a frantic race against time, so please contact us for advice."

“If you are thinking of moving to Exeter or indeed, are considering moving home within the area, please call us for a no-obligation estimate of our fees. We would be pleased to take your call.”

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For more information, call our Residential Conveyancing Team on 01392 209209 or contact us via email at conveyancing@rundlewalker.com

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.

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