Stamp Duty Land Tax (SDLT) relief for first-time buyers changed significantly in April 2025, when a temporary threshold increase introduced in September 2022 came to an end. If you are buying your first home now, you are operating under the reverted rules — and the threshold that matters most is £300,000, not £425,000. This guide explains exactly what you pay, who qualifies, and the common mistakes that void the relief entirely.
What the Rules Are Now (Post-April 2025)
The temporary relief introduced in the Kwarteng mini-budget (September 2022) and extended to March 2025 raised the FTB nil-rate threshold from £300,000 to £425,000 and the maximum qualifying property price from £500,000 to £625,000. That relief ended on 1 April 2025.
From 1 April 2025, the first-time buyer SDLT rates reverted to their pre-2022 position:
| Purchase price | SDLT rate (FTB relief) |
|---|---|
| Up to £300,000 | 0% |
| £300,001 to £500,000 | 5% |
| Above £500,000 | Standard rates apply — FTB relief does not apply |
Standard SDLT rates (no relief) for context:
| Purchase price | SDLT rate |
|---|---|
| Up to £250,000 | 0% |
| £250,001 to £925,000 | 5% |
| £925,001 to £1,500,000 | 10% |
| Above £1,500,000 | 12% |
How this plays out in practice:
A first-time buyer purchasing at £400,000 under the current rules pays:
- 0% on the first £300,000 = £0
- 5% on £300,001 to £400,000 = £5,000
- Total SDLT: £5,000
The same buyer purchasing during the temporary relief period (before April 2025) would have paid nothing on the full £400,000. The April 2025 cliff-edge therefore costs buyers at the £400,000 mark an additional £5,000.
If you are buying above £500,000 as a first-time buyer, you receive no relief at all and pay standard SDLT rates.
Who Qualifies as a First-Time Buyer
The legal definition matters. You are a first-time buyer if you have never previously owned a freehold or leasehold interest in residential property — in the UK or abroad. "Owned" includes:
- A property you bought yourself
- A property you received as a gift
- A property you inherited (see below)
Joint purchases: Both buyers must be first-time buyers. If one purchaser has previously owned a property, neither buyer receives the relief — the full standard SDLT rate applies. This is one of the most common and costly mistakes in joint purchases.
Inherited property: If you inherited a residential property — even if you immediately sold it or disclaimed it — HMRC may treat you as having owned it. The position depends on whether you became the legal registered owner before disclaiming. If a property was left to you in a will and you were registered at Land Registry, you have owned residential property, even briefly. Take specific tax advice if this applies to you.
Overseas property: If you have ever owned residential property abroad — including a holiday home or investment property in another country — you do not qualify as a first-time buyer for SDLT purposes. The relief is based on global ownership history, not just UK ownership.
Right to Buy: Tenants exercising Right to Buy qualify as first-time buyers and can claim the relief.
Company and trust purchases: The relief does not apply to purchases by companies. If a property is being purchased through a trust structure, the position is complex and specialist advice is required.
How to Claim the Relief
There is no separate application to make. SDLT relief for first-time buyers is claimed by your solicitor or conveyancer when they submit the SDLT return (SDLT1 form) to HMRC at completion. The return must include the correct buyer-type code confirming first-time buyer status.
Your solicitor should ask you directly whether you qualify as a first-time buyer as part of their standard onboarding process. Answer these questions accurately — providing false information on an SDLT return is a criminal offence and HMRC does carry out retrospective checks.
SDLT must be paid within 14 days of completion. Your solicitor will typically collect the funds before completion and submit on your behalf.
SDLT on Shared Ownership Purchases
Shared ownership first-time buyers have two options:
Option 1 — Market value election: Pay SDLT on the full market value of the property at the outset (as if you owned 100%), using FTB relief rates. This is often more efficient if you intend to staircase to full ownership, as no further SDLT is payable on later staircasing transactions until you reach 80%.
Option 2 — Pay on the share purchased: Pay SDLT only on the share you are purchasing. If the premium (share price) is below £300,000, no SDLT is payable on it. You then pay SDLT on each future staircasing transaction above certain thresholds.
Option 1 is typically preferable for buyers who expect to staircase, but get advice from your solicitor as the optimal choice depends on the property price and your staircasing plans.
SDLT on Mixed-Use Properties
If you are buying a property with a commercial element — a flat above a shop, a home with a unit let commercially, or a farmhouse with agricultural land — it may qualify as "mixed use" for SDLT purposes. Mixed-use properties are taxed at non-residential SDLT rates:
| Purchase price | Non-residential SDLT rate |
|---|---|
| Up to £150,000 | 0% |
| £150,001 to £250,000 | 2% |
| Above £250,000 | 5% |
This can produce a significantly lower SDLT bill than residential rates. However, claiming mixed-use status when it does not genuinely apply is an SDLT avoidance position that HMRC actively investigates. Seek professional advice before relying on a mixed-use classification.
Common Mistakes That Void the Relief
Not budgeting for SDLT is itself one of the most costly first-time buyer mistakes — but voiding the relief you are entitled to is even more expensive. The six most common ways first-time buyers lose their SDLT relief:
- One buyer is not a first-time buyer: the most expensive mistake — both parties must qualify
- Claiming FTB relief on a property above £500,000: HMRC will recalculate and issue a demand for the underpaid tax plus interest
- Failing to disclose inherited property: even brief legal ownership is ownership
- Overseas property not declared: HMRC has information-sharing agreements with many tax authorities
- Buying through a company: companies cannot claim FTB relief, even if the director is a first-time buyer personally
- Delaying SDLT return past 14 days: late filing incurs automatic penalties (£100 for up to 3 months late, rising thereafter)
If You Overpaid SDLT
If you paid full SDLT when you were entitled to first-time buyer relief — perhaps because your solicitor was unaware of your circumstances — you can reclaim via an amendment to the SDLT return within 12 months of the filing date. HMRC will repay any overpaid tax with interest. Contact your solicitor or a specialist SDLT adviser.
Further Reading
- How to Buy a House in the UK — A Step-by-Step Guide for First-Time Buyers — the full UK house buying process from mortgage-in-principle to completion
- What Is a Homebuyer Protection Insurance Policy? — protecting your buying costs if a purchase falls through before exchange
- Understanding Title Deeds UK — what title deeds contain and what to check before exchange
- Restrictive Covenants on Property UK — title restrictions that can affect what you do with a property after purchase
- First Homes Scheme UK Guide — 30-50% discount on new-build homes for eligible first-time buyers: eligibility, how the covenant works, and the resale implications
- How to Reclaim Overpaid Stamp Duty (SDLT) — if your solicitor missed your FTB relief, the 12-month amendment and 4-year overpayment claim routes explained
- Help to Buy ISA vs Lifetime ISA: Which Is Better for First-Time Buyers? — the 25% withdrawal penalty trap, dual-account strategy, and why the LISA wins for most buyers under 40