Buying and selling your home

What’s happening to Stamp Duty Land Tax in 2025?

Stamp Duty Land Tax (SDLT) is a critical tax levied on property purchases. As we approach April 2025, notable changes to stamp duty will impact both buyers and sellers, altering the landscape of property transactions. 

What is Stamp Duty Land Tax?

Stamp Duty Land Tax (SDLT) is imposed on the purchase of residential property or land in the UK. It is calculated based on the property's purchase price or market value, whichever is higher. SDLT generates revenue for the government and helps regulate the housing market by discouraging property speculation.

Why is Stamp Duty Land Tax changing in 2025?

The Conservative Government introduced a temporary reduction in stamp duty in September 2022 which aimed at lowering the upfront costs of moving home. This initiative sought to support the housing market, safeguard jobs and businesses connected to it, and assist those aspiring to step onto the property ladder.

Although initially announced as a permanent measure, the Autumn Statement 2022 confirmed that the increase in the residential nil-rate threshold will conclude on 31 March 2025.

How is Stamp Duty Land Tax Changing in 2025?

From 1st April 2025, there will be several changes coming into effect:

  • The nil rate threshold, which is currently £250,000, will return to the previous level of £125,000.
  • The nil rate threshold for first-time buyers which is currently £425,000 will return to the previous level of £300,000.
  • The maximum purchase price for which First-Time Buyers Relief (a reduced stamp duty rate) can be claimed is currently £625,000 and will return to the previous level of £500,000.

Thresholds

The threshold is where SDLT starts to apply. If you buy a property for less than the threshold, there’s no SDLT to pay.

Stamp duty rates for main residents in England up to 31 March 2025

Property Value

SDLT Rate

Up to £250,000 Zero
£250,001 to £925,000 5%
£925,001 to £1.5 million 10%
Over £1.5 million 12%

From April 2025 the stamp duty rates are:

Property Value

SDLT Rate for main residence

Up to £125,000 Zero
£125,001 to £250,000 2%
£250,001 to £925,000 5%
£925,001 to £1.5 million 10%
Over £1.5 million 12%

Impact on First-Time Buyers

If the property you are buying is your first home, you can claim discount (relief).  The discount depends on when you purchase the property.

First time buyers discount up to 31 March 2025

First home property value

SDLT Rate

Up to £425,000 Zero
£425,001 to £625,000 5%

If the property is priced over £625,000, you cannot claim relief. SDLT will be due as if you have bought a property before.

First time buyers discount from 1 April 2025

First home property value

SDLT Rate

Up to £300,000 Zero
£300,001 to £500,000 5%

If the property is priced over £500,000, you cannot claim relief. SDLT will be due as if you have bought a property before.

First-time buyers should seek professional advice to navigate these changes to stamp duty effectively. Our property solicitors can help you understand your entitlements, obligations, and the necessary steps to claim these benefits. At Tees Law, our experienced team can provide tailored advice to help you take full advantage of the new SDLT reliefs. Contact us today to discuss your property purchase.

Impact on Second Home Purchases and Investors

Stamp Duty Land Tax (SDLT) on second homes and investment properties is subject to a higher rate than that applied to primary residential properties. However, the forthcoming rate changes will lead to increased tax costs, with mid-range property values—often a focal point for investors—being particularly affected.

For example, on a property purchase at a price of £700,00.00, the SDLT up to 31 March 2025 will be £57,500.00. This will increase from 1 April 2025 to £60,000.00, potentially leading to a smaller return on investment or increases in rental charges. 

Stamp Duty Rates for additional property in England up to 31 March 2025

Proportion of property value

SDLT rate for additional property

Up to £250,000 5%
£250,001 to £925,000 10%
£925,001 to £1.5 million 15%
Over £1.5 million 17%

Stamp Duty Rates for additional property in England from 1 April 2025

Proportion of property value

SDLT rate for additional property

Up to £125,000 5%
£125,001 to £250,000 7%
£250,001 to £925,000 10%
£925,001 to £1.5 million 15%
Over £1.5 million 17%

Alternative investment options like property funds or Real Estate Investment Trusts (REITs) can provide tax-efficient structures and diversification.

Understanding the 2025 stamp duty land tax changes, assessing their financial impact, and implementing strategies to manage increased costs are crucial for investors. By staying informed and proactive, investors can navigate the evolving landscape successfully.


Tees are here to help

We have many specialist lawyers who are based in:

Cambridgeshire: Cambridge
Essex: BrentwoodChelmsford, and Saffron Walden
Hertfordshire: Bishop's Stortford and Royston

But we can help you wherever you are in England and Wales. 


Chat to the Author, Kirsten Vincent

Licensed Conveyancer, Residential Property, Brentwood office

Meet Kirsten
Kirsten Vincent, Conveyancing solicitors in Brentwood | Tees Law
  • Areas of expertise
  • Testimonials

Related categories

Designed and built by Onespacemedia