Stamp duty cuts will stay, but only until 2025. How much will you save?

First-time buyers will not have to pay stamp duty on properties worth less than £425,000.

(Image credit: © Getty Images)

published 17 November 2022

Stamp Duty cuts promised in the September mini-Budget will come to an end on 31 March 2025, chancellor Jeremy Hunt revealed in his autumn statement today.

The cuts in stamp duty would save homebuyers up to £6,250, so anyone looking to buy a house may want to take advantage of those savings while they can.

The Stamp Duty Land Tax cut was one of Kwasi Kwarteng’s crowd-pleasing moves when he set his mini-Budget, aiming to help around 200,000 homebuyers.

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“This will now be a temporary SDLT reduction. The SDLT cut will remain in place until 31 March 2025 to support the housing market and the hundreds of thousands of jobs and businesses which rely on it. The government will amend the Stamp Duty Land Tax (Reduction) Bill to implement this measure,” Hunt stated in his Autumn Statement today.

Here’s what you need to know about the current stamp duty cut, before it is reversed in 2025, and how much you can expect to pay if you are buying a house.

What are the changes in stamp duty tax?

The cut raises means the threshold at which stamp duty is payable will be £250,000 – up from £125,000.

For first time buyers, this threshold is up from £300,000 to £425,000.

The move means around 200,000 homebuyers in England and Northern Ireland will escape having to pay any stamp duty tax altogether. Stamp duty is a devolved tax, so buyers in Wales and Scotland have yet to wait and see if the cut is adopted by their governments too.

The property on which first-time buyers can claim relief also went up from £500,000 to £625,000.

Raising the threshold at which stamp duty is payable means a typical family moving into a semi-detached property will save £2,500 on stamp duty. For a house costing £500,000, you could save £6,250.

Commenting on the new stamp duty tax deadline, Richard Campo, founder of broker firm, Rose Capital Partners said: “Putting a deadline on the stamp duty changes is a really bad idea. The only good thing that came of the infamous mini budget was that the stamp duty allowance wasn’t time limited.

Will house prices come down?

The latest house price index from the ONS shows house prices are coming down, but experts fear a stamp duty tax deadline will result in prices rising again.

“What always happens when you create a deadline? It creates a rush to hit the deadline which pushes up prices artificially,” Campo added.

While stamp duty cuts could reduce the cost of moving, there are concerns it will create a ‘toxic cocktail’ pushing up house prices and help second or buy-to-let property buyers..

“Structural changes in stamp duty aren’t guaranteed to stimulate demand. When relief was introduced for first time buyers, the government assessed the impact the following year. It found that most of those who took advantage were going to buy anyway, so it only increased demand by around 1,000 transactions in the first 13 months.

“Given the costs involved, that worked out as a cost to the Treasury of around £160,000 per extra transaction. It was also calculated to have decreased the cost of buying by up to 0.5 percentage points, but increased prices by up to 0.7 percentage points – wiping out any cost saving for buyers,” Sarah Coles from investment firm Hargreaves Lansdown adds.

There are also concerns that the biggest problem facing the property market right now is a severe shortage of supply – currently, the average agent only has 36 properties on the books.

Stamp duty calculator

If you’re buying a house, depending on the transaction price, you may have to still pay some tax. You can work this out using our stamp duty calculator below.

The calculator is not suitable for first-time buyers, those buying non-residential land or property or non-UK residents.

Who will pay stamp duty and what are the rates (ending 31 March 2025)?

up to £250,000 – you’ll pay 0% on the portion within this band
From £250,001 to £925,000 – you’ll pay 5% on the portion within this band.
From £925,001 to £1.5 million – you pay 10% on the portion within this band.
£1.5m+ – you are charged 12% on the portion within this band.

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Kalpana is an award-winning journalist with extensive experience in financial journalism. She is also the author of Invest Now: The Simple Guide to Boosting Your Finances (Heligo) and children's money book Get to Know Money (DK Books).

Her work includes writing for a number of media outlets, from national papers, magazines to books.

She has written for national papers and well-known women’s lifestyle and luxury titles. She was finance editor for Cosmopolitan, Good Housekeeping, Red and Prima.

She started her career at the Financial Times group, covering pensions and investments.

As a money expert, Kalpana is a regular guest on TV and radio – appearances include BBC One’s Morning Live, ITV’s Eat Well, Save Well, Sky News and more. She was also the resident money expert for the BBC Money 101 podcast .

Kalpana writes a monthly money column for Ideal Home and a weekly one for Woman magazine, alongside a monthly 'Ask Kalpana' column for Woman magazine.

Kalpana also often speaks at events. She is passionate about helping people be better with their money; her particular passion is to educate more people about getting started with investing the right way and promoting financial education.