Date published: 29th August 2024

When moving home, there are many fees and expenses you must keep in mind, and staying track of them all can be a struggle. Every savvy buyer wants to look out for ways to save on these costs to make the process slightly less expensive. One such charge is Stamp Duty Land Tax (SDLT), and depending on the price of your home, this can cost thousands of pounds. However, there may be a way you can cut down on this cost now.

What is Stamp Duty Land Tax?

Stamp Duty Land Tax (SDLT) is a tax paid by the buyer of a UK residential property when the purchase price exceeds £250,000. The stamp duty rate ranges from 5% to 12% of the purchase price, depending upon the value of the property bought. Other factors will change how much SDLT is to be paid, this can be things like being a first-time buyer or whether you are a multiple homeowner, as well as the purchase date.

Back in September 2022, the government revised the thresholds for how much SDLT would be, relative to the cost of the purchase. What this meant was that in every cost bracket, there was a 3% reduction made. The first bracket, in which no SDLT is paid, is set at a nil-percentage on properties up the cost of £250,000. SDLT currently starts at 5% on purchases over this amount (this is the percentage on properties between £250,001 and £675,000).

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In November of 2022, Jeremy Hunt stated that cuts to the cost of SDLT were a temporary measure, designed to offer relief in the short term, rather than a permanent or long-term change. The government hoped this would allow people to move up the property ladder and to assist first time buyers as well. This was devised to support the housing market back then, but this temporary measure comes to an end in 2025.

The 1st April 2025 will see the end to this relief period, the current guidelines set by the government suggest that these percentages will revert to what they were prior to September 2022, unless new guidelines are put in place under the new Labour government. Currently, it looks like the nil-tax percentage will revert to properties below £125,000. This means that a set 2% SDLT may be payable on properties costing between £125,001-£250,000.

According to Rightmove, the most common sale of property in Liverpool in the last twelve months was for semi-detached properties with an average selling price of £234,635. Under the current guidelines lasting until April, there would be no SDLT paid on a sale at this price, but as of April 2025, there would be a 2% SDLT charge on the amount above £125,000 i.e., duty of £2,193.

There is also a set discount for first time buyers which also got updated in 2022. Until April, first time buyers will not pay Stamp Duty on properties under £425,000, if the measures return to what they were before, this threshold will go down to £300,000.

John E Jones, Director & Head of Residential Property at Jackson Lees, argues that:

The SDLT changes in 2022 have had a positive impact on the housing market, benefitted first time buyers and in turn bolstered the economy.”  He hopes that “the Chancellor will in her autumn statement either retain the current thresholds or better still increase them so as to further improve what is currently a sluggish market.”

Our top tips are to:
  • Always budget for SDLT, no matter the cost of the property. Speak to your solicitor about how much this may cost you.
  • Your transaction can take time to complete, so even though this is not happening until April, it is important to know how much you are likely to pay
  • Your completion date will affect the amount of SDLT paid, so keep up to date with your solicitor on when you are likely to complete.
  • Remember, completion dates are not legally binding until contracts are exchanged, so your proposed completion date may be subject to change until this happens.
  • First time buyers should double check how much relief they will receive from their SDLT costs.

For any queries or concerns over the costs and fees you pay during the purchase of a house, speak to our expert team to get the best advice. Either call us or make an enquiry and discover how we might be able to make your housing purchase easier for you.