Government announced removal of 2% standard rate band and raised FTBR thresholds

On 22 September 2022 the government announced that the 2% standard rate of stamp duty land tax (SDLT) for residential properties no longer applies to the part of the property price between £125,000 and £250,000¹. The same announcement raised the thresholds for First Time Buyers' Relief (FTBR)¹. SDLT is paid on property or land purchases in England and Northern Ireland¹.

The change meant that the 2% rate that had applied to that band was removed, so no SDLT was charged on that portion of the price¹. The FTBR nil-rate band and the FTBR purchase price limit were also raised at that time¹. The SDLT (Temporary Relief) Act 2023 later legislated that the SDLT nil-rate band, the FTBR nil-rate band and the FTBR purchase price limit would all revert to their pre-September 2022 levels of £125,000, £300,000 and £500,000 respectively, from 1 April 2025¹.

The September 2022 measures followed earlier changes to the tax. On 8 July 2020 the SDLT holiday raised the nil-rate band to £500,000 for residential purchases, and it continued until 30 June 2021, after which the nil-rate band reduced to the first £250,000 of the purchase price until 30 September 2021¹. A 2% Non-Resident SDLT surcharge was introduced on 1 April 2021 for non-residents buying residential property¹. At Autumn Budget 2024, the higher rates for additional dwellings (HRAD) surcharge was announced to increase from 3% to 5% from 31 October 2024¹.

As of 1 April 2025, the SDLT threshold is £125,000 for residential properties and £150,000 for non-residential properties¹. Residential properties under £125,000 may still be liable to SDLT if subject to either the HRAD or NRSDLT surcharge¹.

Why it matters for households

The removal of the 2% rate on the £125,000 to £250,000 band reduced the SDLT payable on residential purchases in England and Northern Ireland above that range from the date of the announcement¹. The higher FTBR thresholds announced at the same time affected first-time buyers' liability on qualifying purchases¹.

Those changes were temporary. The SDLT (Temporary Relief) Act 2023 set the nil-rate band, the FTBR nil-rate band and the FTBR purchase price limit to revert to their pre-September 2022 levels of £125,000, £300,000 and £500,000 from 1 April 2025¹. HMRC's statistics show transactions were brought forward ahead of that date: total SDLT transactions in Q1 2025 (January to March) were 42% higher than in Q1 2024, which HMRC linked to residential transactions being brought forward prior to the changes in SDLT thresholds effective from 1 April 2025¹. FTBR claims rose 11% between Q4 2024 and Q1 2025, from 41,700 to 46,100, and were 84% higher than Q1 2024, which HMRC also linked to transactions being brought forward prior to the reduction in the nil-rate band and upper limit relief thresholds effective from 1 April 2025¹.

In Q1 2025, 56% of residential transactions were liable for SDLT, compared with 53% in Q1 2024¹. Liable residential transactions increased by 3% between Q4 2024 and Q1 2025, from 154,100 to 158,000, and were 56% higher than Q1 2024¹. The HRAD surcharge, which applies to additional dwellings such as second homes and buy-to-let properties, rose from 3% to 5% from 31 October 2024¹. Liable HRAD transactions increased by 23% from 43,600 in Q1 2024 to 53,800 in Q1 2025, and HRAD transactions accounted for 34% of all liable residential transactions¹.

What happens next

The reversion of the SDLT nil-rate band, the FTBR nil-rate band and the FTBR purchase price limit to £125,000, £300,000 and £500,000 took effect from 1 April 2025¹. The HRAD surcharge increase to 5% took effect from 31 October 2024¹. No further dated changes to these thresholds or rates are set out in the statistics commentary.

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