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Fix the driver behind crashes, sound loss and screen glitchesFind Drivers →Repair Windows errors before they cause bigger problemsFix Now →Scan for outdated or missing drivers - takes under a minuteDriver Scan →For a qualifying purchase in England or Northern Ireland completed on or after 1 April 2025, First-Time Buyers’ Relief charges 0% Stamp Duty Land Tax (SDLT) on the first £300,000 and 5% on the portion from £300,001 to £500,000. The purchase price must be no more than £500,000, every buyer must qualify as a first-time buyer, and every buyer must intend to make the property their only or main residence. A purchase above £500,000 receives no first-time buyer relief: standard SDLT rates apply to the entire price.
Claim the relief on the SDLT return by entering code 32. The return is generally due within 14 days of the transaction’s effective date, usually completion. A conveyancer commonly files it, but you can file directly if necessary. The rules below apply only to SDLT in England and Northern Ireland; Scotland and Wales operate different property taxes.
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What First-Time Buyers’ Relief does
First-Time Buyers’ Relief is an SDLT reduction for individuals buying a residential property to occupy as their main home. Under the rates applying from 1 April 2025, the relief works in two bands:
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| Part of purchase price | SDLT rate with relief |
|---|---|
| Up to £300,000 | 0% |
| £300,001 to £500,000 | 5% |
| Above £500,000 | Relief unavailable; standard SDLT rates apply to the full price |
The £500,000 limit is a cliff edge, not a band that can be used on the first £500,000 of an expensive property. If the consideration is even slightly above £500,000, you lose the relief altogether and calculate SDLT under the ordinary residential rules on the whole transaction.
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Current thresholds are date-sensitive
HM Revenue & Customs (HMRC) changed the first-time buyer thresholds on 1 April 2025. The £300,000 nil-rate band and £500,000 maximum price apply to transactions whose effective date is on or after that date. A completion before 1 April 2025 can fall under earlier thresholds, so do not retrospectively apply the current bands to an older transaction.
What the relief is not
This is not a cash payment, grant or refund paid before completion. It is a reduced SDLT liability claimed through the tax return for the transaction. You still need to complete any SDLT return that HMRC requires, even when the calculation produces no tax to pay.
Eligibility: all of these conditions must be met
Check every condition before exchanging contracts. A failure on one condition removes the relief for the purchase.
1. The property must be in England or Northern Ireland
First-Time Buyers’ Relief described here is part of SDLT, which applies in England and Northern Ireland. Scotland uses Land and Buildings Transaction Tax, and Wales uses Land Transaction Tax. Their first-time buyer rules, rates and filing systems are separate; an SDLT relief claim cannot be transferred to either jurisdiction.
2. The purchase price must be £500,000 or less
Use the chargeable consideration for the dwelling, not an informal estimate of its value. If the price exceeds £500,000, no part of the purchase qualifies for First-Time Buyers’ Relief. Standard SDLT rates apply to the entire consideration.
3. Every purchaser must be a first-time buyer
HMRC applies the test to all purchasers named in the transaction. In a joint purchase, one previous owner is enough to disqualify the whole transaction. It does not matter that the other purchaser has never owned a home or that only one person will live in the property.
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The first-time buyer condition concerns previous ownership of a dwelling or an interest in one. Straightforward cases are usually easy to identify, but unusual ownership histories, trust interests and similar arrangements can be fact-specific. If your past interest was held through a trust or another non-standard structure, obtain case-specific advice rather than relying on a blanket “never owned a home” answer.
4. Every purchaser must intend to occupy the property as their only or main residence
At the effective date, each purchaser must intend that the dwelling will be their only or main residence. HMRC’s manual says immediate occupation is not essential where there is a clear intention to occupy. Circumstances that make moving in immediately impractical do not automatically prevent relief, but the facts must support the stated intention.
For example, a short delay caused by essential work or an existing commitment does not by itself settle the question. Conversely, buying as an investment, holiday accommodation or a property intended solely for another person will generally be inconsistent with the main-residence condition. Where the facts are mixed, document the genuine intention and ask your conveyancer or a tax adviser to review it.
How much SDLT will you pay with the relief?
Band calculation
For an eligible transaction from 1 April 2025, apply 0% to the first £300,000. Apply 5% only to the amount above £300,000, up to the £500,000 ceiling.
| Purchase price | Calculation | SDLT due under relief |
|---|---|---|
| £300,000 | 0% of £300,000 | £0 |
| £350,000 | 5% of £50,000 above £300,000 | £2,500 |
| £450,000 | 5% of £150,000 above £300,000 | £7,500 |
| £500,000 | 5% of £200,000 above £300,000 | £10,000 |
| £500,001 | Relief unavailable; ordinary SDLT calculation applies to the full price | Not calculated under first-time buyer relief |
HMRC publishes the £7,500 result for a £450,000 eligible purchase and the £10,000 result for a £500,000 eligible purchase. They are statutory examples under the current bands, not estimates of typical savings.
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A small price change around £500,000 can have a disproportionately large tax effect. At exactly £500,000, the relief calculation is £10,000. At any amount above the cap, the entire consideration moves to the ordinary SDLT rules. Before agreeing a final price, ask your conveyancer to calculate both outcomes using the exact consideration and effective date.
Determine the transaction’s effective date
The filing deadline and the rate regime depend on the effective date. Completion is usually the effective date, but substantial performance can make an earlier date relevant. Substantial performance can occur, for example, when the buyer takes possession or receives substantially the benefit of the contract before legal completion. Your conveyancer should identify the date recorded for SDLT purposes.
Why the date affects the relief
- An effective date from 1 April 2025 uses the current £300,000 and £500,000 thresholds described above.
- An effective date before 1 April 2025 may use different thresholds and rates.
- The SDLT return deadline is generally 14 days after the effective date, not 14 days after you receive a copy of the signed deed.
If a transaction straddles the threshold-change date, do not assume the completion date alone settles the issue. Ask the filing professional to confirm whether substantial performance occurred earlier.
How to claim First-Time Buyers’ Relief
- Confirm the jurisdiction. Verify that the dwelling is in England or Northern Ireland and that SDLT, rather than a devolved property tax, applies.
- Identify the effective date. Treat completion as the usual date, but check whether substantial performance makes an earlier date relevant.
- Check the price ceiling. Confirm that the chargeable consideration is £500,000 or less. If it is above that amount, stop using the relief calculation and use ordinary SDLT rules for the full price.
- Check every buyer’s status. Each purchaser must satisfy the first-time buyer test and intend to occupy the dwelling as their only or main residence. Review previous property, trust and other interests carefully.
- Calculate the bands. Use 0% on the first £300,000 and 5% on the qualifying amount above £300,000 up to £500,000.
- Complete the SDLT return. On the return, enter relief code 32. HMRC’s relief guidance expressly specifies this code.
- File and pay on time. Submit the return and any SDLT due within 14 days of the effective date when a return is required.
- Retain the evidence. Keep the contract, completion statement, calculation, buyer declarations and the submitted return. They make it easier to correct an error or answer an HMRC query.
Who normally files the return?
A solicitor, conveyancer or agent commonly prepares and files the SDLT return for the buyer as part of the conveyancing process. Their involvement is convenient but is not itself an eligibility condition and is not required to make the relief legally available. If no professional files the return, the buyer can file directly and pay any tax due, following HMRC’s current SDLT return procedure.
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When a return may not be required
HMRC lists limited categories of transactions that do not require an SDLT return. Therefore, avoid assuming that every property transfer always requires one. If you are uncertain whether your transaction falls within an exception, ask the person responsible for the filing or check the current HMRC return guidance. If a return is required, the 14-day deadline still applies even when the relief reduces the tax to zero.
Joint buyers: the rules that catch people out
One qualifying buyer and one previous owner
Suppose two people buy together and one has never owned a dwelling while the other previously owned one. The transaction does not qualify because every purchaser must be a first-time buyer. The result is the ordinary SDLT calculation for the entire purchase, not relief on the qualifying buyer’s share.
Only one buyer will live in the property
The main-residence intention also applies to every purchaser. A buyer who will not occupy the dwelling as their only or main residence can prevent the relief claim, even if the other buyer will live there. Ownership shares, mortgage contributions and who occupies a bedroom do not replace the statutory tests.
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Review the declaration before signing
Ask the conveyancer to show how each purchaser’s status and intended occupation are represented on the return. Correct a mistaken declaration promptly rather than assuming it will be harmless because the difference in tax appears small.
Shared ownership: do not use the ordinary calculation automatically
A first-time buyer acquiring an initial share in a qualifying shared-ownership scheme may be able to claim the relief, but the mechanics differ from a standard outright purchase. HMRC describes two broad approaches: making a market-value election or paying SDLT in stages as additional shares are acquired.
Market-value election
An election can treat the market value of the whole dwelling as the relevant consideration at the outset. The lease terms and the election determine how the tax is calculated and whether later share acquisitions create further SDLT consequences.
Paying in stages
Without a market-value election, SDLT can be considered as shares are purchased. The amount paid, the percentage acquired and later staircasing transactions affect the analysis. The first-time buyer relief conditions still matter, but the £300,000 and £500,000 thresholds cannot be applied by simply multiplying the ordinary example by the initial percentage.
Before signing a shared-ownership contract, obtain the scheme’s lease and price details and ask for a calculation under both available methods where appropriate. Use HMRC’s specific shared-ownership guidance rather than an ordinary-purchase calculator.
Situations requiring fact-specific advice
Previous interests held through a trust
The basic all-buyers test does not resolve every form of trust interest, beneficial ownership or inherited property. The legal and beneficial facts can change the result. Gather the trust deed, sale documents and dates of any earlier interest for a professional review.
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Delayed occupation
Immediate occupation is not an absolute requirement when there is a clear intention to occupy. Keep evidence that explains a temporary delay, such as required works or an unavoidable commitment, and ensure the eventual use is consistent with the declared main-residence intention.
Mixed-use or unusual consideration
Linked transactions, non-cash consideration, fixtures and other elements can affect the chargeable consideration. The £500,000 test applies to the SDLT consideration, not necessarily the headline figure in a marketing listing. Ask for the SDLT calculation before exchange if the contract contains anything beyond a simple residential purchase.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Common errors and how to fix them
- Applying the relief to a £500,001 purchase. The cap is absolute. Recalculate under ordinary SDLT rates on the full consideration.
- Checking only one purchaser’s history. Review every named buyer, including a person added to the title for financing reasons.
- Assuming an investment property qualifies. The main-residence intention must be genuine for every purchaser.
- Using the wrong date. Confirm the effective date and whether substantial performance occurred before completion.
- Missing the code. Enter relief code 32 on the return; do not rely on a narrative note alone.
- Missing the 14-day deadline. Contact the filing professional immediately. Late filing can create penalties and interest even where the underlying tax is reduced.
- Using an English SDLT answer in Scotland or Wales. Identify the devolved tax first; the rates and reliefs are different.
- Using a standard purchase calculation for shared ownership. Review the market-value election and staged-payment rules for the specific lease.
If you discover an error after filing
Tell the solicitor or conveyancer who submitted the return, or contact HMRC using the current SDLT correction process. Provide the transaction reference, effective date, original calculation and the precise change needed. Do not submit a second return for the same transaction unless HMRC’s procedure requires it; duplicate filings can create a new problem.
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- The property is in England or Northern Ireland.
- The expected SDLT effective date is known.
- The consideration is no more than £500,000 under the contract.
- Every purchaser has checked previous dwelling and relevant trust interests.
- Every purchaser genuinely intends to use the property as their only or main residence.
- The calculation uses 0% to £300,000 and 5% above that amount up to the cap for dates from 1 April 2025.
- The person filing the return is identified and has the correct relief code, 32.
- The 14-day filing and payment deadline is diarised from the effective date.
- Any shared-ownership election or staged-payment treatment has been reviewed separately.
Worked scenarios
Single buyer at £280,000
The price is below £300,000. If the buyer is a first-time buyer, intends to occupy the home as their main residence and the effective date is on or after 1 April 2025, the relief calculation produces no SDLT. The buyer still follows the return rules and uses code 32 if a return is required.
Joint buyers at £450,000
The price is within the ceiling. The relief calculation is £7,500: 0% on the first £300,000 and 5% on the remaining £150,000. Both purchasers must meet the first-time buyer and main-residence conditions.
Eligible buyers at exactly £500,000
The relief calculation is £10,000, representing 5% of the £200,000 above the £300,000 nil-rate band. The transaction remains within the ceiling.
Buyers at £510,000
The relief is unavailable because the price exceeds £500,000. The buyers must use the ordinary residential SDLT rules for the whole £510,000, even if both have never owned a property and will live there.
How the date, price and buyer combination changes the answer
| Question | If the answer is “yes” | Consequence |
|---|---|---|
| Is the effective date on or after 1 April 2025? | Use the current thresholds summarized here. | £300,000 at 0%; 5% to £500,000 for qualifying purchases. |
| Is the price above £500,000? | The cap is exceeded. | No first-time buyer relief; ordinary SDLT applies to the full price. |
| Are all purchasers first-time buyers? | The all-buyers test is met on this point. | Continue checking the residence and price conditions. |
| Will every purchaser use the dwelling as their only or main residence? | The intention condition is met on the stated facts. | Continue with the return and code 32 if all other tests pass. |
| Is this a shared-ownership purchase? | Special mechanics apply. | Review the market-value election or staged-payment treatment separately. |
What to ask your conveyancer
- What is the SDLT effective date, and could substantial performance make it earlier than completion?
- Does the chargeable consideration include anything beyond the headline property price?
- Has each purchaser passed the first-time buyer test, including any trust or beneficial interests?
- How is each purchaser’s main-residence intention recorded?
- Will you file the return, and will relief code 32 be entered?
- What is the exact 14-day deadline for this transaction?
- If the purchase is shared ownership, which election or staged-payment method is being used?
- What is the correction route if the return is filed with the wrong code or amount?
Bottom line for a qualifying purchase
For an England or Northern Ireland purchase with an effective date from 1 April 2025, the route is straightforward when the facts are ordinary: every buyer is a first-time buyer, everyone intends to occupy the dwelling as their main residence, and the price is no more than £500,000. Claim 0% on the first £300,000 and 5% on the next qualifying amount by entering code 32 on the SDLT return. File within 14 days when a return is required. Treat prices above £500,000, joint purchases involving a previous owner, shared ownership and unusual ownership histories as separate decision points rather than assuming the standard calculation applies.
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