From the 1st April 2025, home buyers will be required to pay more stamp duty. Hence, an individual who is considering buying a property needs to understand how the recent changes could affect them.

What is Stamp Duty?

Stamp Duty Land Tax (SDLT) is a tax that an individual needs to pay when purchasing a property or land. The amount of tax varies depending on the price of the property.

Whether it is a freehold property, taking a mortgage on a property or buying a new or existing leasehold, you may be subject to SDLT.

What is the current Stamp Duty Land Tax rates?

The current rates before the incoming change are:

• – £250,001 – £925,000 = 5%
• – £925,001 – £1.5m = 10%
• – £1.5m + = 12%

However, those who are purchasing a property between £0-£425,000 and are first time buyers, are subject to 0% SDLT.

How are these rates changing?

From 1st April 2025, these rates will be changing back to their previous levels.

The new rates will be:

• £125,001-£250,000 = 2%
• £250,001-£925,000 = 5%
• £925,001-£1.5m = 10%
•  £1.5m+ = 12%

For first time buyers they are now subject to 0% SDLT for purchases between £0-£300,000.

When do you have to pay stamp duty?

There is a 2-week window in which you are required to pay Stamp Duty from the date of completion in England.

You run the risk of getting a fine or being charged with interest on the amount of SDLT you owe.

How had these changes affected our residential matters?

The increase in the rates caused a surge in transactions in the time leading up to the change in the SDLT. This surge is due to the buyers and investors urge to complete their property transactions before the 1st April 2025, as this change was less desirable. Through finalising their purchases under the existing framework, purchasers aimed to avoid the higher tax.

How can you calculate Stamp Duty Land Tax?

You can calculate how much SDLT is payable on your transaction by following the link below.