Stamp duty changes for 2025: what house-hunters in England need to know

From 1^st April 2025, Stamp Duty Land Tax (SDLT) rates are changing for those buying property in England. Emma Gilroy, Director and Head of Residential Property at JCP Solicitors, explains what this means for house-hunters.

Stamp Duty Land Tax, often referred to simply as ‘Stamp Duty’, is a tax payable upon purchase of a property in England. The amount you pay depends on several factors, including whether the buyer is purchasing a property for the first time, buying as a corporation, replacing a main residence, or purchasing an additional property.

First Time Buyers

New rates of SDLT will come into effect in April, as the temporary increases to thresholds put in place in September 2022 come to an end. While this will impact almost all house-buyers, first-time buyers ought to pay particularly close attention.

The new regulations will mean that first-time buyers will pay no duty up to a value of £300,000 but 5% stamp duty will be due on any home over £300,000, up to £500,000. So, if a first-time buyer purchases a property for £305,000, they will need to pay £4,800.00 in Stamp Duty.

Standard Residential Properties

Currently, the nil-rate threshold stands at £250,000, meaning that anyone purchasing property before 1^st April 2025 will not pay Stamp Duty if their property is worth less than £250,000.

However, from 1^st April, the nil-rate threshold will reduce back to the pre-September 2022  level of £125,000. So, homebuyers ought to be prepared to pay 2% Stamp Duty on any property valued between £125,000 - £250,000.

The amount of Stamp Duty to pay increases with property value: a property valued between £250,001 – £925,000 will require the buyer to pay 2% on the first £250,000 and then 5% on the remaining purchase price up to £925,000. 5% For a property valued between £925,000 to £1.5 million, a further rate of 10% on the balance between £925,001 - £1.5 million will be due. And for any properties purchased for over £1.5 million, 12% Stamp Duty is payable on the balance over £1.5million.

Additional Residential Properties

For those purchasing an additional residential property – a second home, a holiday home, a buy-to-let, for example – the Stamp Duty surcharge has increased from 3% to 5%. This means the minimum rate of SDLT on these properties will be 7%, as the buyer will be required to pay 2% on the first £250,000 plus the additional 5% surcharge.

Corporations and other non-natural persons acquiring residential properties valued over £500,000 will face a Stamp Duty increase from 15% to 17%.

It is worth noting that for properties in Wales, Land Transaction Tax (LTT) is payable rather than SDLT. This operates differently and has different thresholds and rates of tax payable. Find out more here.

Always consult a financial advisor if you have questions or concerns about home affordability. For advice and guidance on residential conveyancing matters in England and Wales, JCP Solicitors can help. Call our team on 03333 208644 or email hello@jcpsolicitors.co.uk.