First time buyer stamp duty

Buying your first home and wondering whether you’ll need to pay Stamp Duty? Stamp Duty Land Tax (SDLT) applies to most house purchases in England and Northern Ireland. But, different rules apply to first time buyers.

What is stamp duty?

Stamp duty
Stamp duty

Stamp duty is a tax you might need to pay when you buy a residential property or land. Buyers in England and Northern Ireland pay Stamp Duty Land Tax (SDLT) on properties they purchase.

It applies whether the property is freehold or leasehold and if it’s bought with a mortgage or outright.

The amount of stamp duty you pay depends on:

  • when the property was purchased
  • how much was paid for it
  • eligibility for relief or exemptions – for example, if you’re a first time buyer.

Stamp duty rates for first time buyers

There are different stamp duty thresholds for first time buyers than for those looking to move home. This is because the government offers first time buyer stamp duty relief, depending on the price of the property.

Stamp duty rates

The Stamp Duty rates for first time buyers are:

  • 0% to pay up to £300,000
  • 5% from £300,001 to £500,000

If you’re paying more than £500,000 you won’t be eligible for first time buyer’s relief. You’ll pay the same stamp duty as people who have bought a house before. Find out more on our stamp duty page.

What might this look like for you?

Say you find your perfect first home for £500,000, the current Stamp Duty costs would look like this:

  • Nothing to pay on the first £300,000.
  • 5% on the remaining £200,000 = £10,000
  • The total to pay would be £10,000

The government has a calculator to help you find out what you might owe.

Stamp duty for first time buyers in Scotland and Wales

Stamp duty doesn’t apply in Scotland and Wales. Instead:

With LBTT, first time buyers won’t pay tax on purchases up to £175,000. But different bands and rates apply depending on the property type.

For LTT, there’s a general threshold of £225,000 for most property purchases in Wales. But there’s no first time buyer relief, so the same thresholds apply to everyone.

How to pay stamp duty

The solicitor or conveyancer handling your purchase will usually handle paying stamp duty for you. But you’re ultimately responsible for making sure it’s done, so do check with them.

If you need to pay it yourself

You may still need to send a return, even if you're exempt from paying.

Can I add it to my mortgage?

You may be able to borrow enough to cover your tax payment. If you do, you’ll have a larger mortgage and pay more interest so it’s worth considering carefully.

Borrowing more may also impact your loan to value ratio, which can determine the rate you’re offered.

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