Stamp Duty changes - what they mean for you

What is Stamp Duty?

Stamp Duty Land Tax or Stamp Duty is a tax you might have to pay when buying a property or a piece of land in England or Northern Ireland. If you’re buying a home in Wales or Scotland, this won’t apply to you as they have different systems. In Wales you'll pay Land Transaction Tax and in Scotland you'll pay Land and Buildings Transaction Tax.

 

You’ll pay Stamp Duty if the home you’re buying costs more than a certain amount. This will vary depending on if you're buying a new home, first home or additional home.

 

The amount of Stamp Duty you pay will vary depending on the price of the property. Stamp Duty is calculated based on bands. You'll only pay tax on the portion of the property price that falls within each band.

 

The current Stamp Duty rates (until 31 March 2025)

Property purchase price	Stamp Duty rate
Up to £250,000	0%
£250,001 to £925,000	5%
£925,001 to £1.5 million	10%
Above £1.5 million	12%

Example: If the house you buy costs £310,000 and your mortgage completes before 31 March 2025, the Stamp Duty you owe will be:

• 0% on the first £250,000 = £0
• 5% on the final £60,000 = £3,000
• total Stamp Duty = £3,000

How is Stamp Duty changing?

From 1 April 2025 some Stamp Duty thresholds will decrease meaning the amount of Stamp Duty you pay may increase. 

 

Stamp Duty rates from 1 April 2025

Property purchase price	Stamp Duty rate
Up to £125,000	0%
£125,001 to £250,000	2%
£250,001 to £925,000	5%
£925,001 to £1.5 million	10%
Above £1.5 million	12%

Example:  If the house you buy costs £275,000 and your mortgage completes after 1 April 2025, the Stamp Duty you owe will be:

• 0% on the first £125,000 = £0
• 2% on the second £125,000 = £2,500
• 5% on the final £25,000 = £1,250
• total Stamp Duty = £3,750

What this means for first time buyers

If you’re a first time buyer, you can claim a discount or relief. You’ll be eligible for this if you or anyone you’re buying with is a first time buyer. From 1 April 2025, the maximum property price eligible for the discount will decrease from £425,000.

 

Discount from 1 April 2025

Property purchase price	Stamp Duty rate
Up to £300,000	0%
£300,001 to £500,000	5%

Example: If your first home costs £400,000 and your mortgage completes after 1 April, the Stamp Duty you owe will be:

• 0% on the first £300,000 = £0
• 5% on the remaining £100,000 = £5,000
• total Stamp Duty = £5,000

If the price of your home is over £500,000, you’re not eligible for the relief. You’ll need to follow the rules for those who’ve bought a home before.

Stamp Duty changes for additional homes

If you’re already own a home and are buying another, you’ll be charged a higher Stamp Duty rate. The thresholds for the higher rates are also changing and rates will increase on 1 April 2025.

 

The higher rates from 1 April 2025

Property purchase price	Stamp Duty rate
Up to £125,000	5%
£125,001 to £250,000	7%
£250,001 to £925,000	10%
£925,001 to £1.5 million	15%
Above £1.5 million	17%

What does this mean for my outstanding Principality mortgage application?

If you have an outstanding mortgage application with Principality, you'll need to pay the increased Stamp Duty if your residential mortgage completes after 1 April 2025.

 

To calculate how much Stamp Duty you’ll owe, use the Government’s Stamp Duty calculator.