First‑Time Buyer Relief: Eligibility, Rates and Examples

July 23, 2025

Buying your first home is a milestone, but it also comes with a lot of financial planning. One of the biggest costs buyers face in England and Northern Ireland is Stamp Duty Land Tax (SDLT). To make home ownership more accessible, the government introduced First Time Buyer Relief. This relief can significantly reduce, or even eliminate, the amount of stamp duty you pay.

If you are thinking about buying your first home, understanding how this relief works could save you thousands of pounds. Below, we explore the rules, eligibility criteria, rates, and practical examples to help you make informed decisions.

Who Qualifies as a First‑Time Buyer?

To qualify for the relief, you must meet all of the following conditions:

You must have never owned a residential property or an interest in a property, either in the UK or abroad.
If you are buying with someone else, every person on the purchase must also be a first‑time buyer.
The property must be intended as your only or main residence. You cannot claim the relief if you are buying a second home, an investment property, or a buy‑to‑let.
The purchase price of the property cannot be more than £625,000.

If any of these conditions are not met, you will not be eligible for the relief and normal SDLT rules will apply.

How Much Stamp Duty Will You Pay?

The SDLT bands for first‑time buyers are:

£0 to £425,000: No stamp duty is charged.
£425,001 to £625,000: 5% is charged only on the amount above £425,000.
Over £625,000: First‑Time Buyer Relief does not apply. Standard SDLT rates will be charged on the whole purchase price.

Examples

Example 1: Buying a property for £350,000

This is below the £425,000 threshold.
Stamp duty payable: £0.

Example 2: Buying a property for £500,000

No stamp duty on the first £425,000.
5% on the £75,000 above that = £3,750 payable.

Example 3: Buying a property for £650,000

This exceeds the £625,000 limit.
First‑Time Buyer Relief cannot be claimed.
SDLT is charged at the standard residential rates.

Why Is This Relief Important?

Stamp Duty Land Tax can add a significant cost to your purchase. For first‑time buyers who have already saved for a deposit and are facing other moving costs, this relief can be a vital financial boost. It allows you to put more of your savings toward your new home or other essential expenses like furniture or renovations.

How Do You Claim the Relief?

You do not need to complete a separate application for First‑Time Buyer Relief. Your solicitor or conveyancer will usually claim it on your behalf when they submit the SDLT return to HMRC. However, it is your responsibility to make sure you are genuinely eligible and to inform your solicitor that you qualify.

Important Notes

First‑Time Buyer Relief applies only in England and Northern Ireland. Scotland and Wales have their own property tax regimes with different rules.
If your circumstances change after purchase (for example, you later buy another home), it does not affect the relief you claimed at the time, as long as you were eligible on the day of completion.
If you make an incorrect claim, HMRC may require you to pay the correct amount of SDLT plus interest and penalties. Always be certain of your eligibility.

Final Thoughts

First Time Buyer Relief remains one of the most valuable support measures for new homeowners in the UK. Understanding how it works, the limits that apply, and the eligibility criteria can help you plan ahead and make the most of the savings available.

If you are preparing to buy your first home, speak with your conveyancer early, confirm your eligibility, and ensure the relief is claimed on your SDLT return. With the right preparation, you can focus on enjoying your new home rather than worrying about unexpected tax costs.