If you’re buying a home for the first-time, you may need to budget for stamp duty as part of the expenses involved in your new home purchase. Stamp duty land tax (to give it it’s full title – or SDLT) is a one-off tax that must be paid when you buy a property in England and Northern Ireland, costing more than a certain threshold.

do first time buyers pay stamp duty

In an effort to help more people onto the housing ladder, the government has made changes to the stamp duty threshold over recent years. This means that, as a first-time buyer of property priced up to £500,000, you will pay no stamp duty on the first £300,000 (or £500,000 if a shared ownership property).

While this has been good news for many prospective homeowners, the cost of property in south west London means that it’s likely you will still need to pay something.

If you are new to buying property, it is important to understand how stamp duty works – and who is a first-time buyer and who isn’t.

What is stamp duty?

Stamp duty must be paid when you buy residential property or land in England and Northern Ireland that costs more than £125,000. The rate at which you pay stamp duty depends upon the purchase price. In Wales it is known as Land Transaction Tax (LTT) and in Scotland it’s Land and Buildings Transaction Tax (LBTT).

Different rules apply for first-time buyers. There is also an additional stamp duty levy for people buying a second property.

How much is first-time buyer’s stamp duty?

First-time buyers in England and Northern Ireland, purchasing properties costing up to £500,000, don’t pay stamp duty on the first £300,000 and pay 5% on the portion between £300,000 and £500,000.

Rates for first-time buyers

Property value SDLT rates
Up to £300,000 0%
The portion from £300,001 to £500,000 5%


In addition, the autumn 2018 budget extended the stamp duty tax exemption to first-time buyers purchasing shared ownership properties valued at up to £500,000. This change applies to homes purchased on or after 22 November 2017.

What is a first-time buyer?

You will not be considered a first-time buyer if you have owned or inherited a property before or if you have been named on the deeds of another property.

Nor will you be eligible if you are married and your spouse has owned a property in the past, even if you have never owned a property in your own right. However, if you are not married but living with a partner who has owned a property, and you have not, you will be considered a first-time buyer.

If you are purchasing a buy to let property, you won’t be considered a first-time buyer either, even if you haven’t owned property before – although you are allowed to rent out a room in your home.

What will I pay if I’m not considered a first-time buyer?

Stamp duty is a progressive tax, meaning you pay a higher percentage as the property price rises – but you only pay the higher rate for the portion of the price at that rate.

Stamp Duty Rates

Property value SDLT rates
Up to £125,000 0%
The next £125,000 (the portion from £125,001 to £250,000) 2%
The next £675,000 (the portion from £250,001 to £925,000) 5%
The next £575,000 (the portion from £925,001 to £1.5 million) 10%
The remaining amount (the portion above £1.5 million) 12%


You can work out exactly how much you will need to pay by using a stamp duty calculator – there is one on the government website.

Higher rates for additional properties

You will usually pay 3% on top of the normal stamp duty rates if buying a home means you will own more than one property. Find out more about additional property rates on the government website.

How to pay stamp duty

You have 14 days from completion date to file your stamp duty return and pay (previously the time limit was 30 days). If you don’t pay on time you could be fined.

In most cases, the solicitor carrying out your conveyancing will pay the tax on your behalf at completion and add the amount to their fees. They will also claim any stamp duty relief you’re eligible for, such as relief for first-time buyers. However, it is your responsibility to ensure that the stamp duty is paid.

Other benefits for first-time buyers

The government’s Help to Buy schemes including Help to Buy: Shared Ownership and Help to Buy: Equity Loan are designed to help people get on the property ladder. If you took out one of the Help to Buy ISAs before 30 November 2019, you will also receive a government bonus to boost your deposit.

If you are looking to buy property in Wimbledon, Coombe or around, contact us. We can advise you about stamp duty as well as other aspects of your house purchase and show you our current selection of properties.

About the author

Nicolas Holmes

Nick joined Robert Holmes to inject fresh ideas and help grow the New Homes department of Robert Holmes as well as helping to inject technology into the business and to grow its client base. Together with one of the Directors Nick is in charge of all Development opportunities that Robert Holmes deals with along with sales. Aged 40, he provides succession together with the two existing directors. Nick has always been focused on building client relationships and sales. He built up his own gallery in Chelsea, where he had a loyal following of customers and artists.

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