Back to main menu
Search
Search
Overlay

The information in this guide relates to properties located within England and Northern Ireland. Schemes differ for properties in Scotland and Wales. NatWest mortgages are available to over 18s. Your home or property may be repossessed if you do not keep up repayments on your mortgage. The content on this webpage is guidance only and does not constitute advice.

Stamp Duty for first time buyers

Officially called Stamp Duty Land Tax (SDLT), Stamp Duty applies to most property purchases in England and Northern Ireland. Scotland and Wales have different systems.

Stamp Duty can seem confusing when it’s your first purchase. But there are different rules and Stamp Duty exemptions for first time buyers. Read on to see how it applies and what you need to be aware of.

Do first time buyers pay Stamp Duty?

You’ll only need to pay Stamp Duty if the property value is above a certain amount.

For first time buyers in England and Northern Ireland, the threshold for paying Stamp Duty is much higher due to the government’s relief scheme. Standard Stamp Duty rates apply if the property is worth more than £625,000.

 

Minimum property price

Maximum property price

Stamp Duty rate

£0

£425,000

0%

£425,001

£625,000

5%

£625,000

£1,500,000

10%

£1.5m+

-

12%

 

You only pay tax on the amount above the threshold. If you were to buy a home for £429,000, as a first time buyer, you’d only pay 5% tax on the £4,000 that falls above the £425,000 threshold. 

Find out more about tax rates for first time buyers Open in new window

Stamp Duty differences in Scotland and Wales

First time buyers in Scotland will pay no Stamp Duty (known as Land and Buildings Transaction Tax) on property purchases up to £175,000. In Wales, while there’s no equivalent scheme, no one will pay Stamp Duty (known as Land Transaction Tax) on property purchases up to £225,000.

Young man in new home surrounded by boxes looking at laptop while on the phone

Are you a first time buyer?

You’ll need to meet certain criteria to qualify for Stamp Duty discounts for first time buyers. Relief is only available if:

  • The home will be your only or main residence
  • You haven’t previously owned a freehold residential property
  • You don’t have an existing leasehold interest
  • You’ve never owned a foreign property or inherited one.
Explore the government guide to first time buyer qualification Open in new window
Young couple on sofa at home laughing at phone

Do both people need to be first time buyers?

Buying a home with another person can be an effective way to get on the property ladder. But to benefit from the Stamp Duty relief scheme, everyone included in the application needs to be classed as a first time buyer.

Standard Stamp Duty rates will apply if you’re purchasing your first home but the other person isn't.

Stamp Duty if you're not a UK resident

Things are a little different for first time buyers and Stamp Duty if you’re not classed as a UK resident. You’ll need to have been in the UK for 183 days in the 12 months leading up to your purchase.­­

If you don’t meet this criteria, you’ll generally face a 2% surcharge on your Stamp Duty rate – whether you’re a first time buyer or not.

Government advice on rates for non UK residents Open in new window
Young couple carrying boxes upstairs moving house

Mixed-use property rates for first time buyers

As the name suggests, mixed-use properties aren’t strictly residential or non-residential. This could be a flat above a shop or an apartment joined to a GP’s surgery. Different Stamp Duty rates apply to this property category. As a result, first time buyers can’t qualify for their usual relief.

The thresholds for leasehold properties are slightly different but for freehold sales, the Stamp Duty rates are:

  • 0% for properties up to £150,000
  • 2% for properties between £150,001 and £250,000
  • 5% above £250,000.
Get advice on rates for non-residential and mixed land and property Open in new window

How do first time buyers pay Stamp Duty?

Even if you don’t need to pay Stamp Duty, you’ll still need to file a Stamp Duty return. This is normally handled by the solicitor or conveyancer helping you with the purchase. If you owe anything, first time buyers can make a Stamp Duty payment like anyone else. 

The standard process is:

  • Send a payment to HM Revenue and Customs (HMRC) within 14 days of your completion date.
  • Use the 11-character transaction reference you’re given.
  • Choose a payment method that suits you. This can include online payments, bank transfers and cheques.

You could face financial penalties if you file your Stamp Duty late. The following fixed penalties can apply:

  • £100 – up to three months late
  • £200 – more than three months late.

More help for first time buyers

If you think a first time buyer mortgage is right for you and you're looking for information to apply, head over to our first time buyer hub. You can find additional information as well as guidance on how to start your mortgage journey.

First time buyer guide Open in new window