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Stamp Duty: Upcoming Changes to Expect in 2025

Stamp Duty rules in England and Northern Ireland are set to change in April 2025, potentially increasing the costs for first-time buyers, home movers, and investors or owners of multiple properties by thousands of pounds. Here’s all you need to know about the upcoming changes.

What is Stamp Duty?

Stamp Duty Land Tax (SDLT) is a tax applied when purchasing property or land in England and Northern Ireland.

Stamp Duty for First-Time Buyers

Currently, first-time buyers in England and Northern Ireland are exempt from Stamp Duty on properties worth up to £425,000. However, from April 1, 2025, properties valued between £300,001 and £500,000 will incur a 5% Stamp Duty rate on the portion of the price above £300,000.

For example:

  • Purchase price: £325,000
  • Current Stamp Duty: £0 (for first-time buyers)
  • From April 1, 2025: £1,250 (5% applied to the £25,000 above £300,000)

How Will the Changes Affect Home Movers?

At present, home movers in England and Northern Ireland pay no Stamp Duty on homes priced up to £250,000. From April 2025, however, homes priced between £125,001 and £250,000 will be subject to a 2% rate.

For example:

  • Purchase price: £350,000
  • Current Stamp Duty for home movers: £5,000
  • From April 1, 2025: £7,500 (2% applied to £125,000 to £250,000, and 5% on the portion above £250,000)

Impact on Investors or Owners of Multiple Properties

Currently, investors, buy to let landlords, or those who own more than one property face a 5% Stamp Duty rate on properties priced up to £250,000. Starting in April 2025, properties priced between £0 and £125,000 will attract a 5% Stamp Duty, with higher rates of 7% of 10% applied to more expensive properties.

For example:

  • Purchase price: £350,000
  • Current Stamp Duty for investors/owners of multiple properties: £17,500
  • From April 1, 2025: £25,000 (5% applied to the first £125,000, 7% on the next £125,000, and 10% on the remaining amount)

Conclusion

The upcoming changes to Stamp Duty will affect a wide range of buyers in England and Northern Ireland. We’d recommend purchasing your next property ahead of these changes being introduced in April 2025 if you can, and if not, ensure you budget accordingly and consider the increased stamp duty costs within your overall purchase.

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