First-time Buyers’ Relief for Stamp Duty Land Tax (SDLT)
Saving for a first home can be challenging, and the costs of buying a property quickly add up. Between deposits, legal fees, surveys, and moving costs, many first-time buyers feel the financial pressure before they’ve even set foot in their new home. One of the biggest expenses is stamp duty land tax (SDLT)—a tax paid when buying property in England or Northern Ireland.
The good news is that the government offers first-time buyers’ relief to help ease this burden. This relief can significantly reduce, or even eliminate, the amount of SDLT payable on your first home purchase. Below, we’ll explore what the relief is, who qualifies, how much you can save, and what’s changing from April 2025.
What is First-time Buyers’ Stamp Duty Relief?
Stamp duty land tax is a tiered tax payable when you purchase residential property above a certain value. In November 2017, the government introduced a specific relief for first-time buyers, recognising how difficult it can be to step onto the property ladder.
The relief applies to house purchases in England and Northern Ireland only. It raises the threshold at which SDLT becomes payable, meaning many first-time buyers don’t have to pay the tax at all.
Even if no SDLT is due, buyers must still file a return to claim the relief. Typically, this is handled by your conveyancing solicitor, but it’s crucial to let them know you are a first-time buyer. Otherwise, you risk missing out.
Who Counts as a First-time Buyer?
The definition of a “first-time buyer” is stricter than many expect. To qualify, you must:
- Be purchasing your first ever dwelling in the UK or abroad.
- Intend to live in the property as your main residence (not rent it out or use it as a holiday home).
- Not have inherited, been gifted, or previously owned a share in a residential property.
When purchasing with another person, both buyers must qualify as first-time buyers. If just one person has previously owned property, the relief is unavailable—regardless of whether you’re buying as joint tenants or tenants in common.
This rule prevents couples where one partner has already owned property from accessing the relief together.
Stamp Duty Land Tax Rates for First-time Buyers
The relief works by raising the 0% SDLT threshold and introducing reduced rates above it.
As of April 2025, the rates are as follows:
Purchase price | SDLT rate for first-time buyers |
Up to £300,000 | 0% |
£300,001 – £500,000 | 5% on the portion above £300,000 |
£500,000+ | No relief – standard SDLT rates apply |
Example:
If you buy your first home for £375,000, the first £300,000 is tax-free. You then pay 5% on the remaining £75,000, which equals £3,750.
If you purchase for £280,000, you pay nothing.
But if your first home costs £525,000, the relief doesn’t apply at all—you’ll pay SDLT at the normal rates.
Mortgages and Borrowing Structures That Qualify
The way you finance your home can affect whether you qualify for relief. Here are some common scenarios:
- Help-to-Buy: Genuine first-time buyers using help-to-buy mortgages can claim the relief.
- Shared Ownership: Relief applies whether you pay SDLT on the full value or just on your share, provided the market value is £500,000 or less.
- Joint Mortgage: Both buyers must meet the first-time buyer definition.
- Joint Borrower Sole Proprietor: Relief may still be possible if the other borrower doesn’t have a beneficial interest or right to occupy.
- Gifted Deposit Mortgage: As long as the deposit is truly gifted and the donor isn’t on the deeds, the buyer remains eligible.
Given the complexity of SDLT rules, it’s wise to seek independent financial advice before committing.
How SDLT is Changing in 2025
Between September 2022 and March 2025, the government temporarily increased SDLT thresholds to ease the cost-of-living crisis. During this period:
- No SDLT was payable on homes up to £425,000 for first-time buyers.
- Reduced rates applied on properties up to £625,000.
However, these generous thresholds ended on 1 April 2025. The government rolled back relief to pre-2022 levels:
- 0% up to £300,000
- 5% between £300,001 and £500,000
- No relief over £500,000
Who is Most Affected?
The rollback disproportionately impacts buyers in high-value areas like London, the South East, and the South West, where average first-home prices often exceed £300,000. According to recent analysis, over 90 local authorities now fall above the £300k line, meaning more first-time buyers face SDLT bills they wouldn’t have paid in 2024.
First-time Buyers in Scotland and Wales
It’s important to note that SDLT relief does not apply across the entire UK.
- Wales: First-time buyer relief is not available under the Welsh Land Transaction Tax regime.
- Scotland: Scotland operates the Land and Buildings Transaction Tax (LBTT). First-time buyers receive a modest relief that raises the nil-rate band to £175,000. However, the maximum saving is capped at £600—significantly less than the relief in England and Northern Ireland.
Practical Tips for First-time Buyers
- Tell your solicitor early – Relief must be claimed, it’s not automatic.
- Check joint eligibility – If buying with someone else, both must be genuine first-time buyers.
- Consider timing – If your purchase completed before April 2025, you may have benefited from higher thresholds.
- Budget for SDLT – Even with relief, properties above £300k can trigger significant tax bills.
- Get advice – A financial adviser or conveyancer can confirm your eligibility and ensure your claim is correct.
Why First-time Buyers’ Relief Matters
For many, the relief makes the difference between being able to afford their first home and being priced out. For example:
- A buyer purchasing at £295,000 saves £4,750 in SDLT compared to a non-first-time buyer.
- Someone buying at £400,000 saves £5,000.
While the relief may not fully offset high house prices, it does offer a valuable saving—especially when combined with other schemes like Lifetime ISAs or shared ownership.
Final Thoughts
First-time buyers’ SDLT relief is a lifeline for those stepping onto the property ladder in England and Northern Ireland. But with the rollback in April 2025, the scope of the relief has narrowed considerably. Many buyers in higher-value regions will once again face significant tax bills.
If you’re planning to buy your first home:
- Check whether you qualify for relief.
- Factor SDLT into your budget.
- Seek legal and financial advice before making commitments.
Property law and tax rules shift frequently, and SDLT is no exception. Staying informed could save you thousands and help you secure your first home with greater confidence.
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