How will Stamp Duty change in 2025, and what will it mean for your move? Find out how using a broker could help you.
The Stamp Duty Land Tax (SDLT) rates will change from the 1st April 2025, as the temporary thresholds expire. The Conservative government announced the lower thresholds as a temporary change in the 2022 Autumn Statement; however, Rachel Reeves did not extend the deadline in Labour’s first Budget last year. Unfortunately, this decision could add thousands of pounds to your home move costs.
Despite the Labour Government's pledge to help more first-time buyers get on to the property ladder, the change will affect this group the most.
Understanding the Stamp Duty Changes
Several changes will take place on the 1st April 2025:
- The 0% rate threshold will revert to £125,000 from £250,000
- The 0% rate threshold for first-time buyers will revert to £300,000 from £425,000
- The maximum purchase price for First-Time Buyers Relief (a reduced rate of SDLT) will revert to £500,000 from the current £625,000
Stamp duty for home movers
For example, say you purchase a property for £295,000, just above the current UK average house price of £292,000. Here’s how your Stamp Duty costs will change depending on when you complete on your home purchase:
Completion on or before 31st March 2025:
- 0% on the first £250,000 (£0)
- 5% on the final £45,000 (£2,250)
Total SDLT to pay = £2,250
Completion on or after 1st April 2025
- 0% on the first £125,000 (£0)
- 2% on the next £125,000 (£2,500)
- 5% on the final £45,000 (£2,250)
Total SDLT to pay = £4,750
This means you could save £2,500 by pushing your property purchase through before the April deadline.
Stamp duty for first-time buyers
Let’s look at an example for first-time buyers purchasing a property at a price of £350,000 to see how much the changes will cost them.
Completion on or before 31st March 2025:
- The current minimum threshold for first-time buyers to pay SDLT is £425,000
- In this example, there would be no SDLT to pay
Total SDLT to pay = £0
Completion on or after 1st April 2025
- 0% on the first £300,000 (£0)
- 5% on the final £50,000 (£2,500)
Total SDLT to pay = £2,500
Use our online Stamp Duty calculator to calculate how much you could save by completing your home purchase before the deadline.
Beating the deadline
If you plan to purchase a property in 2025, whether as a first-time buyer or home-mover, working with one of our expert mortgage brokers is the best way to navigate the SDLT changes. To take advantage of the current SDLT rates, you need to complete your property purchase by the 31st March 2025.
This may seem far off, but when it comes to property purchases, there’s not much time left.
Here are three ways you can help speed up your purchase process:
- Get your essential documents together so you don’t waste time looking for them later. The very least you’ll need for a mortgage application is:
- Proof of identity
- Proof of address
- Proof of income – your last three months’ PAYE payslips or a SA302 form or HMRC tax overview accounting for the previous 2 years of self-employed income are usually enough
- Proof of deposit
- Check your finances and credit score. A lender will do this too, but it’ll help avoid nasty surprises and delays during the mortgage application process. If possible, pay off any or as much outstanding debt as you can, and be upfront and honest about any issues (historical or ongoing) you might have.
- Get a mortgage Decision in Principle (DIP) when you start house hunting. That way, you’re clear on your budget and estate agents know you’re serious and not a timewaster!
Here are three ways MFB can help you speed up your purchase process:
- Our knowledge of the mortgage market means we can find you the best lender to meet your individual needs. We can secure your DIP, and you can be confident that your application will fit your lender’s criteria and help prevent any unnecessary delays.
- Your broker reviews your full mortgage application before submission to anticipate any concerns your lender may have in advance. This way, we can package your application with all the information necessary for a smooth mortgage process.
- Your dedicated Client Relationship Manager will chase your lender and solicitor to keep things moving along. Our team has a comprehensive understanding of the mortgage process and knows that conveyancing can slow it down. We get regular updates from your lender and solicitor for you, so you can get on with day-to-day life!
Speak to an expert
Planning a property purchase in 2025 and want to see if you can secure the current Stamp Duty rates? Get in touch with our team. We can help you secure a decision in principle (DIP) and advise you on your best next steps. Call our homebuyer team on 0345 345 6788 or submit an enquiry here.
