First-Time Buyer Stamp Duty in 2026: Where the Relief Ends

£6,250 at £425,000 — half the standard bill

A first-time buyer purchasing a £425,000 home in England or Northern Ireland pays £6,250 in Stamp Duty Land Tax in 2026 — £5,000 less than the £11,250 a standard buyer pays on the same property. The relief is worth exactly £5,000 at every price where it applies, because it removes the tax on the £125,000–£300,000 slice that everyone else pays.

But the relief has a hard edge: it only exists on properties costing £500,000 or less. Cross that line by a single pound and the entire discount vanishes.

How the relief works

Since 1 April 2025, first-time buyers pay SDLT on these bands:

• 0% on the first £300,000
• 5% on the portion from £300,000 to £500,000

Standard buyers pay 0% up to £125,000, 2% from £125,000 to £250,000, and 5% from £250,000 to £925,000. The first-time buyer schedule effectively extends the nil-rate band from £125,000 to £300,000 — which is why the saving is a flat £5,000 (2% of £125,000 plus 5% of £50,000) at any qualifying price above £300,000.

The numbers at four price points

Property price	First-time buyer	Standard buyer	Relief saves
£300,000	£0	£5,000	£5,000
£425,000	£6,250	£11,250	£5,000
£500,000	£10,000	£15,000	£5,000
£625,000	£21,250	£21,250	£0

Up to £300,000, a first-time buyer pays no stamp duty at all. From there to £500,000 the effective rate stays low — 1.47% of the purchase price at £425,000, 2% at £500,000. At £625,000 the first-time buyer pays exactly what everyone else pays: £21,250, or 3.4% of the price.

The £500,000 cliff

The relief is all-or-nothing. At £500,000 the bill is £10,000; at £500,001 it is £15,000 — standard rates applied to the whole price, not just the pound above the cap.

That makes the pricing around the cap unusually important. If you are negotiating on a property listed at £505,000, getting the price to £500,000 saves £5,250 in tax on top of the £5,000 price reduction. Equally, paying for fixtures or furnishings separately (at a fair, documented value) rather than rolling them into the property price can legitimately matter near the threshold — though HMRC scrutinises apportionments that look artificial.

Who qualifies

The conditions are stricter than many buyers expect:

• Never owned before, anywhere. You cannot have owned or part-owned residential property in the UK or abroad — including a share of an inherited house.
• Everyone on the purchase. If buying jointly, all purchasers must qualify. One previous owner on the deed removes the relief for the whole transaction.
• You will live there. The property must be intended as your only or main residence — buy-to-let purchases don’t qualify.
• England and Northern Ireland only. Scotland (LBTT) and Wales (LTT) have separate systems with different reliefs.

The full rules are on GOV.UK: SDLT residential rates and first-time buyer relief.

Mind the other cap: the LISA stops at £450,000

If your deposit is sitting in a Lifetime ISA, note that the two schemes’ limits don’t line up. SDLT relief runs to £500,000, but a LISA can only be used penalty-free on a first home costing £450,000 or less — buy at £470,000 and you’d keep the stamp duty relief yet pay a 25% penalty to withdraw your LISA money. Between £450,000 and £500,000 there’s a band where the taxman helps you and the LISA punishes you; see LISA vs regular ISA for how that penalty works.

Check your own purchase

Every figure above comes from the same band-by-band calculation the Stamp Duty Calculator runs. Enter your actual price and buyer type to see the bill, the effective rate, and how the tax splits across bands — including the 5% surcharge if you are buying an additional property rather than your first.