Do you pay stamp duty on a new build as a first-time buyer?

“Do you pay stamp duty on a new build as a first-time buyer?”

…That’s one of the questions we get asked the most, and the simple answer is no. First-time buyers do not pay stamp duty on a new build property worth up to £300,000.

But other factors can come into play, so we’ve put together this guide on everything you need to know about stamp duty as a first-time buyer.

What is stamp duty in the UK?

Stamp Duty Land Tax (SDLT) is a tax that buyers must pay when purchasing land or property above a certain value in England and Northern Ireland. In Wales, this tax is called Land Transaction Tax (LTT), and in Scotland, it’s known as Land and Buildings Transaction Tax (LBTT) – each with its own rates and rules.

The amount you pay is a percentage of the total property value and depends on:

When you bought the property
How much you paid for it
Whether you’re eligible for relief or an exemption

You can use the government Stamp Duty UK 2025 Calculator to find out how much tax you’ll pay. Generally, the higher the property price, the higher the rate of stamp duty will be. Higher rates may apply when acquiring multiple properties or properties for investment purposes.

Stamp duty thresholds UK 2024 – 2025

As of April 2025, the zero-rate stamp duty threshold has been reduced from £250,000 to £125,000 in England and Northern Ireland. The new rates are as follows:

Up to £125,000: 0% (or 5% additional property rate)
£125,001 – £250,000: 2% (or 7% additional property rate)
£250,001 – £925,000: 5% (or 10% additional property rate)
£925,001 – £1.5 million: 10% (or 15% additional property rate)
£1.5 million+: 12% (or 17% additional property rate)

Does stamp duty apply to new builds?

Yes, stamp duty applies to both new builds and existing properties in England and Northern Ireland. New builds are treated the same way as any other property when it comes to stamp duty.

Unless the buyer is a first-time buyer, eligible for government and/or developer stamp duty exemption incentives, or purchasing in unusual circumstances, the total stamp duty will likely have to be paid.

First-time buyer stamp duty UK

First-time buyers don’t pay Stamp Duty Land Tax (SDLT) on any property valued at up to £300,000. This is known as first-time buyer stamp duty relief. The current rates for first-time buyers are as follows:

No SDLT on purchase prices of up to £300,000
5% SDLT on the portion from £300,001 to £500,000
If the price is over £500,000, you cannot claim first-time buyer stamp duty relief

Depending on where you live in the UK, you may be more likely to face a stamp duty bill in 2025 as a first-time buyer. This is due to the varying average house prices across different cities and regions. In London, for example, the average house is worth around £564,000.

Example stamp duty costs for a first-time buyer

If you’re a first-time buyer and purchase a property for £500,000, the Stamp Duty Land Tax (SDLT) you owe will be calculated as:

0% on the first £300,000 = £0
5% on the remaining £200,000 = £10,000
Total SDLT = £10,000

If you’re a first-time buyer and purchase a property for £600,000 (or any price more than £500,001), the standard £125,000 threshold applies and will be calculated as follows:

5% on £600,000 = £30,000
Total SDLT = £30,000

UK stamp duty changes for first-time buyers

Before April 2025, first-time buyer stamp duty relief was up to the property value of £425,000. This year, the threshold has decreased to £300,000.

When researching stamp duty charges, it’s important to check the article date to ensure you’re getting the most recent information.

Are stamp duty rates the same for new builds as existing buildings?

Stamp duty rates for new build homes are generally the same as those for existing properties. However, the way the tax is calculated can differ slightly due to how the final purchase price is determined.

Should any upgrades or purchasable extras be added to your new build Redmile home, these must be paid for in full, as they cannot be added to the purchase price.

When are you exempt from paying stamp duty?

In addition to first-time buyer stamp duty relief, there are several other situations where you may be eligible for a full or partial exemption from Stamp Duty Land Tax (SDLT) when purchasing a new build or other property. Common scenarios where you may not have to pay SDLT include:

The property is transferred to you due to divorce or dissolution of a civil partnership
The property is left to you in a will
You buy a freehold property for under £40,000
You negotiate a lower purchase price below the threshold
You ask the developer if they can exclude the cost of fittings / fixtures from the total value

For full and up-to-date guidance, visit the official HMRC SDLT reliefs and exemptions page on the government website. If you’re unsure about your eligibility, it’s best to consult your solicitor or conveyancer.

How to check if you’re a first-time buyer

The UK first-time buyer definition is someone who has never owned or had a major legal interest in a residential property or land, anywhere in the world. This includes any form of ownership – whether bought, inherited, or shared. In simple terms, if your name has never appeared on a property’s title deeds, you’re classed as a first-time buyer.

Importantly, if you’re buying a property with someone else, all purchasers must meet these same conditions. If even one person has previously bought, inherited, or shared the ownership of a property, the new purchase will not qualify for first-time buyer status or the associated stamp duty relief.

Speak with a new home specialist at Redmile Homes

When buying a property, it’s essential to factor in stamp duty and other moving costs from the outset. Understanding how much stamp duty you’ll need to pay can help you budget more accurately and assess what’s truly affordable as you search for your new home.

If you’re planning a property purchase, Redmile Homes is here to help! Our experienced team is ready to answer any questions, explain the costs involved, and help you find the perfect property that fits your lifestyle and budget.

Get in touch with us today!

Author: Redmile Homes

5/28/2025

Do you pay stamp duty on a new build as a first-time buyer? Everything you need to know