As a first-time home buyer in the UK, it’s important to factor in the cost of stamp duty. This tax can add thousands to the price of buying a home, but there is relief available for first-time buyers.

Stamp Duty Land Tax (SDLT), also known as Land Transaction Tax (LTT) in Wales and Land and Buildings Transaction Tax (LBTT) in Scotland, is the tax levied on the purchase of property and land in England and Northern Ireland.

First-time buyers in England and Northern Ireland who purchase a home up to £425,000 do not have to pay any stamp duty since September 22nd, 2022. If the home is worth between £425,001 and £625,000, a 5% stamp duty rate will apply only on the value above £425,000.

For properties worth more than £625,000, normal stamp duty rates will apply and first-time buyer relief will not be available.

In Scotland, if you’re buying your first home and it is worth less than £175,000, you will not have to pay any stamp duty (LBTT). The LBTT rate for first-time buyers in Scotland is tiered as follows:

Up to £175,000 – 0%
£175,001-£250,000 – 2%
£250,001-£325,000 – 5%
£325,001-£750,000 – 10%
£750,001+ – 12%

In Wales, there is no first-time buyer stamp duty relief and you’ll pay the same Land Transaction Tax (LTT) bill regardless of whether this is your first home or not. But, no-one in Wales pays LTT on property worth less than £180,000. LTT is tiered based on the value of your home, so here’s what you’ll pay:

Up to £180,000 – 0%
Up to £180,001-£250,000 – 3.5%
£250,001-£400,000 – 5%
£400,001-£750,000 – 7.5%
£750,001-£1,5m – 10%
£1.5m+ – 12%

To qualify as a first-time buyer in the taxman’s eyes, you must never have owned, or had an interest in, a residential property in the UK or overseas. This includes both freehold and leasehold property. It’s worth noting that stamp duty is set to change again in April 2025 according to the government’s autumn 2022 budget.