New SDLT Rates from 1 April 2025

From 1 April 2025, the new SDLT Rates (Stamp Duty Land Tax Rates) and bandings will apply on residential property purchases.

Furthermore, the SDLT rate that applies when an individual purchases an additional residential property increased from 3% to 5% on 31 October 2024.

The rates and bandings for SDLT that now apply when individuals purchase a residential property from 1 April 2025 onwards can be summarised per the table below:

Note, different rates of SDLT apply for first time buyers and non-UK resident individuals.

The higher rates of SDLT will commonly apply when one of the individual purchasers already owns a residential property, or a share in a residential property that is worth more than £40,000.

This will mean that an individual already owning a residential property, purchasing an additional residential property worth £500,000, will now pay £40,000 in SDLT. Prior to 31 October 2024 the charge would have been £27,500 based on the former rates and bandings in place.

However, if the purchase can be shown to be a replacement of an individual’s former main residence, then the lower normal rates of SDLT can apply instead. This means the purchaser can look to reclaim any additional SDLT paid at the time of purchase under the main residence replacement rules. In the example described above (taking place post 1 April 2025) the SDLT due will decrease from £40,000 to £15,000, a saving of £25,000!

In order for the main residence replacement rules to apply the following must apply:

• The property bought is replacing your former main residence.
• The previous main residence was sold within three years from the date the new main residence was acquired.

If you are replacing your former main residence within this time frame, we would recommend you contact your solicitor to reclaim any additional SDLT due to you. We have found in the past that this can sometimes be overlooked.

Please do get in touch with Joe Wilson on 023 8046 1237 or email Joe Wilson should you have any queries concerning the new SDLT rates