Understanding the Current UK Stamp Duty Rates vs The Changes Coming in April 2025

If you plan to buy property in the UK, understanding stamp duty is essential. With changes to the Stamp Duty Land Tax (SDLT) scheduled for April 2025, now is the time to consider how these updates may affect your plans. Let’s break down the current rates, including the benefits for first-time buyers, and compare them with the upcoming changes.

Current Stamp Duty Rates (2023/24)

Stamp Duty Land Tax is payable on property purchases in England and Northern Ireland. The tax is different if the property or land is in: Scotland - pay Land and Buildings Transaction Tax. Wales - pay Land Transaction Tax if the sale was completed on or after 1 April 2018. As it stands in England and Northern Ireland:

For First-Time Buyers: There’s a special relief for properties up to £425,000. First-time buyers purchasing a home up to this amount pay no stamp duty on the first £300,000. Above this threshold, the standard rates apply. 

For buyers of additional properties, such as second homes or buy-to-let investments, an additional 3% surcharge applies on top of these standard rates.

What’s Changing in April 2025?

The April 2025 changes aim to address affordability challenges and generate additional revenue for public services. Here’s what’s expected:

First-Time Buyers: Relief thresholds are being adjusted. The zero-rate band for first-time buyers will decrease to £250,000, with the remaining relief available up to £400,000. This means first-time buyers may face higher costs on purchases above £250,000.

Additional Properties: Buyers of second homes or investment properties will continue to pay an additional 3% surcharge, but with the lower thresholds, the costs will increase significantly.

Table indicates current rates as of pre Apr 1, 2025 & New rates post Apr 1, 2025 based of buyers position

What Does This Mean for Buyers?

The upcoming changes will likely increase the upfront costs for many buyers. For first-time buyers, the reduced relief thresholds could make purchasing a property more expensive, particularly in high-demand areas where property prices exceed £250,000. Buyers of second homes or higher-value properties should also prepare for higher SDLT costs under the revised thresholds.

Additionally, the reduced 0% threshold for standard buyers may affect those purchasing properties in the mid-range market, as they will now pay more stamp duty on transactions between £200,000 and £250,000.

Should You Buy Now or Wait?

The answer depends on your circumstances and market conditions. If you're a first-time buyer or purchasing in the mid-market range, acting before April 2025 could save you a significant amount in SDLT. However, if you’re buying a higher-value property or additional property, it’s worth consulting with financial and legal advisors to assess the long-term implications of these changes.

How Kiwi Property Management Can Help

Navigating stamp duty and its implications can be complex, but you don’t have to do it alone. At Kiwi Property Management, we’re here to help you understand the property market and make informed decisions. Whether you’re a first-time buyer, investor, or moving up the property ladder, we can provide tailored advice and support to ensure your property journey is as smooth as possible.

If you have questions or need guidance on how the stamp duty changes might impact you, don’t hesitate to contact us today to speak with one of our expert advisors.