Following Labour’s first budget since 2010, a major change to Stamp Duty Land Tax has been announced, which will come into effect from tomorrow (31 October 2024).
Stamp Duty Land Tax (SDLT) is a tax that must be paid to HM Revenue & Customs when purchasing an interest property or land in England. There are several factors which can affect the stamp duty payable. It is calculated as a percentage of the purchase price or part of the purchase price, with some purchases benefiting from reliefs (such as first-time buyers) and others having to pay increased rate (such as second-home owners and companies).
The Chancellor has now announced that there will be an increase in the stamp duty surcharge on second homes, buy-to-let, and company purchases of residential property from 3% to 5%.
Property value | Rate for second homes and investment properties |
Up to £250,000 | 5% |
£250,001 to £925,000 | 10% |
£925,000 to £1.5 million | 15% |
over £1.5 million | 17% |
In September 2022 there was a temporary increase to the thresholds for standard rate SDLT starting at £250,000, which is due to expire on the 31st of March 2025. There was no announcement to extend this in today’s Budget so transactions completed after this date will revert to the previous stamp duty rates as follows:
Below are the rates from the 31st March 2025: | |
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 £1.5million | 10% |
over £1.5 million | 12% |
Additionally, the threshold for First Time Buyer relief will return to its previous level of £300,000, and the maximum purchase price for First Time Buyer Relief will return to £500,000 from the current level of £625,000.
Below are the First Time Buyer rates from the 31st March 2025: | |
Property value | Rates for first time buyers |
Up to £300,000 | 0% |
£300,001 to £500,000 | 5% |
As such, if you are a first-time buyer completing a purchase after 31st March 2025 for a house with a price of £350,000, you will have to pay SDLT of £2,500 instead of nil, as it currently would be.
If you are considering the purchase of a property, whether as a first-time buyer or a property investor and are worried about what rate of SDLT you will be required to pay, our property experts at Farleys are on hand to advise you on all aspects of your purchase. Get in touch today on 0845 287 0939, contact us by email, or use the online chat below.