How will the stamp duty changes coming into effect from 1/1/25 affect you?
Significant changes to Stamp Duty Land Tax (SDLT) are coming in April 2025, affecting property purchases in England and Northern Ireland. Whether you’re a first-time buyer, moving home, or investing in property, these changes will impact how much tax you’ll need to pay. If you do want to take advantage of the current, more advantageous rates of SDLT it is important that you plan ahead and start working on your property transaction as soon as possible.
Current SDLT Rates (until April 2025)
Currently, no stamp duty is payable on properties up to £250,000. Above this threshold, the tax operates on a tiered system:
- £250,001 – £925,000: 5%
- £925,001 – £1.5 million: 10%
- Over £1.5 million: 12%
First-time buyers enjoy relief on properties up to £625,000, paying no SDLT on the first £425,000.
Key Changes from April 2025
New Standard Rates
The tax-free threshold will decrease to £125,000, with new rate bands:
- Up to £125,000: 0%
- £125,001 – £250,000: 2%
- £250,001 – £925,000: 5%
- £925,001 – £1.5 million: 10%
- Over £1.5 million: 12%
First-Time Buyers
The relief for first-time buyers will be adjusted:
- 0% on the first £300,000
- 5% on property value between £300,001 and £500,000
Additional Properties
Buy-to-let and second home purchases will face increased surcharges:
- Up to £125,000: 5%
- £125,001 – £250,000: 7%
- £250,001 – £925,000: 10%
- £925,001 – £1.5 million: 15%
- Over £1.5 million: 17%
So how will you prepare for the changes or meet the deadline?
- Budget Carefully: Calculate the new SDLT costs when planning your property purchase
- Plan Ahead: Consider timing your purchase based on the new rates
- Seek Professional Advice: Consult with property experts to understand how these changes affect your specific situation
- Stay Informed: Keep track of any additional updates or amendments to the changes
These changes represent significant adjustments to property tax so if you are planning to buy property in 2025 or beyond, ensure you have factored these new rates into your budget.
SDLT is a self-assessment tax and you must ensure you are fully aware of the amounts that become payable at the point of completion.
Before agreeing to any completion dates and providing your authority to exchange contracts, please ensure you have checked with us as to what your SDLT liability will be.
This will create very high demand indeed for completions pre-31/3/25 and in order to have the best chance of meeting this you will need the best Conveyancer possible to be on your side.
As at the date of writing 13th January 2025 we are aiming to complete all transactions we have before the deadline and this will be reviewed on a weekly basis.
Call 01302 431433 or email [email protected] to maximise your chances of meeting the deadline!
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