By James Crawford, Lead Market Analyst — Updated March 2026
I warned people about this for months. Back in 2022, when Kwarteng's mini-budget temporarily jacked up the stamp duty nil-rate thresholds, every estate agent in the country started quoting the lower tax figures as if they'd last forever. They were never going to last forever. The legislation had an expiry date stamped right on it.
And on 1 April 2025, the music stopped. The thresholds snapped back to their pre-2022 levels, and thousands of buyers who'd been dragging their feet suddenly owed thousands more in tax. I watched it happen in real time — panicked completions in March, solicitors working weekends, buyers begging for extensions that were never going to come.
If you're buying now, in 2026, these are the rates you're stuck with. Here's exactly what changed and what it means for your wallet.
What Actually Changed on 1 April 2025
The nil-rate band — the chunk of the purchase price you pay zero stamp duty on — got slashed in half. That's the headline. Everything else flows from that.
Standard Rates (England & NI)
| Band | Before 1 April 2025 | From 1 April 2025 |
|---|---|---|
| 0% threshold | £0 – £250,000 | £0 – £125,000 |
| 2% band | N/A | £125,001 – £250,000 |
| 5% band | £250,001 – £925,000 | £250,001 – £925,000 |
| 10% band | £925,001 – £1,500,000 | £925,001 – £1,500,000 |
| 12% band | Above £1,500,000 | Above £1,500,000 |
See that 2% band that didn't exist before? That's the sting. You now pay 2% on everything between £125k and £250k. On a £250,000 purchase, that's £2,500 in tax that simply didn't exist six months earlier.
First-Time Buyer Rates
| Item | Before 1 April 2025 | From 1 April 2025 |
|---|---|---|
| 0% threshold | Up to £425,000 | Up to £300,000 |
| 5% band | £425,001 – £625,000 | £300,001 – £500,000 |
| Maximum purchase price | £625,000 | £500,000 |
This is the one that really winds me up. First-time buyers used to pay nothing on the first £425k. Now it's £300k. And the maximum purchase price where relief applies dropped from £625k to £500k — which basically excludes most of London. If you're a first-time buyer in Hackney or Islington looking at anything above half a million, you now pay the same rates as everyone else. Cheers, Treasury.
How Much More Are You Actually Paying?
I've run the numbers at every common price point. Some of these increases look small in isolation, but remember — this is money you need to find in cash on completion day, on top of your deposit, legal fees, and everything else.
| Purchase Price | Old SDLT | New SDLT | Increase |
|---|---|---|---|
| £200,000 | £0 | £1,500 | +£1,500 |
| £300,000 | £2,500 | £5,000 | +£2,500 |
| £400,000 | £7,500 | £10,000 | +£2,500 |
| £500,000 | £12,500 | £15,000 | +£2,500 |
| £750,000 | £25,000 | £27,500 | +£2,500 |
| £1,000,000 | £32,500 | £41,250 | +£8,750 |
For most buyers in the £250k–£925k range, the hit is exactly £2,500. That's the 2% tax on the £125k–£250k band that was previously free. Annoying, but not devastating. The people getting properly hammered are buying above £925k, where the increase jumps to £8,750 because they're also losing the nil-rate benefit on the £125k–£250k band at a higher marginal rate.
And if you're buying a second property? Add the 5% surcharge on top of all this. A landlord buying at £300k pays £20,000 in stamp duty. That's almost 7% of the purchase price gone before you've even changed the locks. (I wrote about this in detail in my Buy-to-Let ROI guide.)
Who Got Hit Hardest
First-Time Buyers in London and the South East
This is the group I feel genuinely sorry for. A first-time buyer picking up a flat at £500,000 in London — which isn't exactly a mansion — previously paid £3,750 in stamp duty. They now pay £10,000. That's an extra £6,250 in cash they need to find, on top of a deposit that was already eye-watering. Many of these buyers were already stretching themselves thin. Some have told me this increase was the final straw that pushed them to rent for another year or two.
Home Movers
Movers get no first-time buyer relief, so they feel the full force. Buying at £300,000, a mover now pays £5,000 in SDLT versus £2,500 before — that's a 100% increase. And unlike first-time buyers, movers also have to fund their purchase from the proceeds of selling their current place, which means chain risk, bridging costs, and all the rest of it. The stamp duty increase is salt in an already expensive wound.
Buy-to-Let and Second Home Buyers
These buyers were already getting hammered by the surcharge increase from 3% to 5% in October 2024. Combined with the April 2025 threshold reversion, an investor buying at £250,000 now pays £15,000 in total stamp duty (£2,500 standard + £12,500 surcharge). Before the surcharge increase, the same purchase cost £7,500. That's double. The government has made it very clear they don't want small landlords buying property, and the maths now backs that up.
What This Has Done to the Market
I've been tracking the fallout for almost a year now. Here's what I'm seeing on the ground:
- Buyers are negotiating harder. Sellers know their buyers are paying more in tax, so there's more wiggle room on asking prices — particularly on properties that have sat on Rightmove for 8+ weeks. I've seen £5,000–£10,000 reductions accepted more readily than any time in the last three years.
- Sub-£125k markets are heating up. Properties below the nil-rate band are stamp-duty-free. In northern cities — Sunderland, Stoke, parts of Hull — there's been a noticeable pickup in investor activity. Whether that's smart investing or chasing headlines, time will tell.
- The BTL exodus is accelerating. Higher stamp duty on entry, Section 24 strangling profits, and now stricter EPC requirements coming in 2028 — it's a triple squeeze. I know landlords with 5-property portfolios who are selling down to 2 or 3. The ones holding on are either sitting in limited companies or playing the capital growth game with deep pockets.
- First-time buyers are leaning harder into LISAs. The £1,000/year government bonus from a Lifetime ISA has become more valuable when you need to offset a bigger stamp duty bill. I've seen a spike in LISA sign-ups among the 25–35 crowd.
How to Deal With It
You can't avoid stamp duty (legally), but you can plan around it:
- Run the numbers before you start viewing. Our Stamp Duty Calculator is always up to date. Know your SDLT bill before you fall in love with a property and then find out you can't afford the tax on top.
- Budget stamp duty as a separate line item. Don't fold it into your deposit fund. You need the deposit AND the stamp duty AND the legal fees AND a contingency buffer. Most first-time buyers need 12–15% of the purchase price in cash, not just the 10% deposit.
- Check your first-time buyer eligibility properly. If you — or anyone you're buying with — has ever owned property anywhere in the world, you don't qualify. I've seen couples lose £5,000+ in stamp duty savings because one partner owned a flat in Spain years ago and forgot to mention it. It's a binary test.
- Use the stamp duty bill as a negotiation tool. "I'm paying £10,000 in stamp duty on this — can you come down £3,000 on the asking price?" It's a legitimate argument, and sellers who've been sitting for a while are receptive to it.
- Don't rush a purchase just to save on stamp duty. I saw people panic-buy in March 2025 to beat the deadline and end up in properties they didn't really want. Buying the wrong house to save £2,500 in tax is a spectacularly bad trade when you're making a six-figure commitment.
Sources: HMRC Stamp Duty Land Tax guidance, HM Treasury Autumn Budget 2024 policy documents, UK Finance mortgage transaction data. This article is for information only and does not constitute financial advice. See our Disclaimer.