First-Time Buyer Stamp Duty UK — The April 2025 Reversion and What It Means

April 2025 brought a significant cost increase for first-time buyers in England and Northern Ireland. The temporary stamp duty relief introduced in September 2022 expired on 31 March 2025, and the thresholds reverted to their previous levels. For buyers purchasing a property above £300,000, the change added thousands of pounds to the cost of their first home.

If you are currently saving to buy or are in the process of purchasing, this guide tells you exactly what the current rules are, how much extra SDLT you now face, what options exist for buyers in expensive areas, and how Scotland and Wales handle first-time buyer relief differently.

What Changed on 1 April 2025

Before 1 April 2025 (the "temporary" higher thresholds)

The September 2022 mini-budget — and the subsequent decision by the then-Conservative government to make the relief permanent, only later reversed — gave first-time buyers in England and Northern Ireland:

• Nil-rate threshold: £425,000 (no SDLT on the first £425,000)
• Maximum property value for FTB relief: £625,000

From 1 April 2025 (current rules)

The thresholds reverted to the pre-2022 permanent levels:

• Nil-rate threshold: £300,000 (no SDLT on the first £300,000)
• Maximum property value for FTB relief: £500,000

For purchases above £500,000, first-time buyer relief does not apply at all — standard SDLT rates apply instead.

Current SDLT Rates for First-Time Buyers (England and Northern Ireland)

For purchases above £500,000 by first-time buyers, standard SDLT rates apply from £0:

Cost Comparison: Before and After April 2025

The difference is most visible for buyers in the £300,000–£500,000 price range — the core range for first purchases in many English cities and suburbs.

Above £500,000, FTB relief does not apply in either period — the difference narrows because standard rates apply in both cases.

The maximum additional cost from the reversion is £6,250 — which falls on buyers purchasing at exactly £425,000 to £500,000. This sum is not trivial when added to the existing cost pressures on first-time buyers: deposits, conveyancing fees, survey costs, and mortgage arrangement fees.

Worked Example: £400,000 Property in 2026

A first-time buyer purchasing a £400,000 property in England today:

• First £300,000: 0% = £0
• Next £100,000 at 5%: £5,000
• Total SDLT: £5,000

Under the pre-April 2025 rules, this would have been £0. The reversion has added £5,000 to the cost of buying a £400,000 first home.

If the buyer requires a 10% deposit (£40,000) and must also find £5,000 in SDLT, the total cash required at exchange rises to approximately £50,000 — plus legal fees and surveys.

Scotland: Land and Buildings Transaction Tax (LBTT)

Scotland uses its own property tax — Land and Buildings Transaction Tax (LBTT) — administered by Revenue Scotland. The First-Time Buyer (FTB) relief for LBTT was not subject to the April 2025 changes that affected England.

LBTT First-Time Buyer Relief (current)

The FTB nil-rate threshold in Scotland is £175,000 — lower than England's £300,000. Scotland did not have a "temporary" uplift to reverse, so no reversion occurred.

Example: £250,000 property in Scotland

• £175,000 at 0% = £0
• £75,000 at 2% = £1,500
• Total LBTT: £1,500

In England, the same property incurs £0 SDLT under FTB relief. Scotland's FTB relief is less generous for properties above £175,000.

Wales: Land Transaction Tax (LTT)

Wales uses Land Transaction Tax (LTT), administered by the Welsh Revenue Authority. Wales has no specific first-time buyer relief — all buyers, including first-timers, pay at the same rates:

Example: £300,000 property in Wales

• £225,000 at 0% = £0
• £75,000 at 6% = £4,500
• Total LTT: £4,500

A first-time buyer in Wales pays £4,500 on a £300,000 property; the equivalent purchase in England costs £0. The absence of FTB relief in Wales is a significant additional burden for Welsh first-time buyers.

Strategies for Buyers in Expensive Areas

Shared Ownership

For buyers in London and the South East where average first-home prices often exceed £400,000, shared ownership offers an important alternative. Key tax points:

• SDLT (or LBTT/LTT) is calculated only on the share being purchased, not the full market value
• The buyer can elect to pay SDLT on the full market value upfront (a "marketable value election") to avoid future SDLT on staircasing
• On a 40% share of a £500,000 property (market value £200,000 for the share), SDLT is £0 under FTB relief (below £300,000)

Shared ownership brings the effective purchase price within FTB nil-rate territory for many London buyers who would otherwise face a substantial SDLT bill.

First Homes Scheme

The First Homes scheme offers first-time buyers a minimum 30% discount on the market price of new-build homes. The discount is permanent and passes to future eligible buyers.

On a £400,000 new-build property with 30% First Homes discount, the purchase price falls to £280,000 — bringing it below the £300,000 FTB nil-rate threshold. SDLT: £0.

The scheme requires buyers to meet local connection or key worker criteria in many areas, and property availability is limited to participating developers. But where available, it effectively eliminates both the SDLT cost and reduces the deposit requirement.

Lifetime ISA (LISA) in 2026

The Lifetime ISA provides a 25% government bonus on savings up to £4,000/year (maximum £1,000/year bonus). It can be used towards the purchase of a first home with a value of up to £450,000.

The maximum property cap of £450,000 for LISA use has not changed with the April 2025 SDLT reversion. However, the interaction is relevant: a £450,000 purchase now attracts £7,500 SDLT under FTB rules (up from £1,250 pre-April 2025). The LISA bonus helps offset this, but does not fully compensate for buyers at the upper end.

If you withdraw LISA savings for any purpose other than first-time purchase (or retirement at 60, or terminal illness), a 25% penalty applies — effectively recovering the bonus and charging an additional 6.25% on your original savings.

Reclaiming SDLT After a Mistake

SDLT returns must be filed within 14 days of completion. If a buyer incorrectly pays standard rates instead of FTB rates — for example, because their solicitor was not aware of the relief — HMRC will issue a refund on an amended return, provided it is submitted within 12 months of the filing deadline (so up to 26 months after completion in most cases).

Conversely, if a buyer applies FTB relief incorrectly — for example, where one buyer in a joint purchase has owned property before — HMRC can investigate and issue a penalty. In joint purchases, all buyers must be first-time buyers for the FTB rate to apply.

Joint Buyers: All Must Qualify

FTB relief applies only when every purchaser is a genuine first-time buyer. If you are buying jointly with a partner who already owns (or has previously owned) a property, you do not qualify for FTB relief. You pay standard SDLT rates. This affects cohabiting couples where one party previously owned and sold a home.

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Use our Stamp Duty Calculator to calculate your exact SDLT bill under the current 2025 rates for any purchase price in England, and our Mortgage Calculator to model how the SDLT cost affects your total funds needed at exchange and your long-term mortgage repayments.