A guide to the Stamp Duty changes and how they’ll impact property investors.
What is stamp duty and why does it matter?
Stamp duty land tax (SDLT) is a tax that must be paid when purchasing a property or land in England and Northern Ireland. The amount you pay depends on several factors such as the purchase price, if you are buying it to live in or as an investment or second home, if you are a first-time buyer, and if you live in the UK or overseas.
For investors, SDLT is a key factor in determining the overall cost of property acquisition, and any increases in this tax can directly affect the profitability of an investment.
The shock announcement from Labour’s Autumn Budget that they will increase the investor surcharge from 3% to 5% came into effect less than 24 hours after the announcement. It means that investors who’ve delayed investing are already worse off.
There is a further increase with the return to lower pre-pandemic thresholds in April 2025 so there is still time to make a saving. Delaying your purchase could increase your overall costs significantly.
Quick Tip: The best way to capitalise, maximise capital growth and take advantage of the increase coming in stamp duty is by investing in Off-Plan property. They bring advantages such as warranties, amenities and increased tenant demand but most importantly by buying off-plan you’re likely to get below market value opportunities in the biggest regeneration areas and your pick of the best units leading to maximised growth of your capital.
Scroll down to the bottom of the article to download our FREE guide to Off-Plan investing.
Current stamp duty rates
In September 2022, as part of an initiative to get the property industry moving again post COVID, the government revised the thresholds for how much SDLT would be payable relative to the purchase price. This was to be a temporary measure rather than a permanent change and is due to come to an end in April 2025.
These are the current SDLT rates for the residential rate, investor surcharge and non UK residents will need to pay:
| Property price | Residential Rate | Investor Surcharge | Non UK Resident |
| Up to £250,000 | 0% | 5% | 2% |
| The next £675,000 (£250,001-£925,000) | 5% | 5% | 2% |
| The next £575,000 (£925,001 – £1.5 million) | 10% | 5% | 2% |
| The remaining amount (portion above £1.5 million) | 12% | 5% | 2% |
For example, if you were to purchase a £300,000 property as a non UK resident and landlord you would pay the following :
Residential Rate = £2,500
Investor Surcharge = £15,000
Non UK Resident = £6,000
Total = £23,500
It is also worth noting that a non UK resident landlord is classed as someone who lives or spends more than 6 months of the year outside of the UK.
What Will Stamp Duty Rates Be From April 2025?
From April 1, 2025, stamp duty residential rate thresholds will revert to their pre-pandemic levels, increasing the amount of tax investors will need to pay. Here’s a breakdown of what to expect:
| Property price | Residential Rate | Investor Surcharge | Non UK Resident |
| Up to £125,000 | 0% | 5% | 2% |
| The next £124,999 (£125,001 – £250,000 | 2% | 5% | 2% |
| The next £674,999 (£250,001-£925,000) | 5% | 5% | 2% |
| The next £574,999 (£925,001 – £1.5 million) | 10% | 5% | 2% |
| The remaining amount (portion above £1.5 million) | 12% | 5% | 2% |
For example, if you were to purchase a £300,000 property you would pay the following :
Residential Rate = £5,000
Investor Surcharge = £15,000
Non UK Resident = £6,000
Total = £26,000
What does that mean for me?
Here are some examples of how much stamp duty you would pay as a UK investor based on properties, we currently have available.
| Property | Property Price | Today’s SDLT rate | April 2025 SDLT rate | £ Difference |
| City Exchange, Bradford | £165,000 | £8,250 | £9,050 | £800 |
| Portside Place, Liverpool | £192,000 | £9,600 | £10,940 | £1,340 |
| Smithfield House, Birmingham | £355,995 | £23,100 | £25,600 | £2,500 |
| Aspen, London | £955,000 | £84,500 | £87,000 | £2,500 |
Why Property Investors Should Act Now
With the April 2025 changes looming, time is running out to take advantage of the current, lower stamp duty rates. Delaying your investment could cost you thousands in additional taxes. Here are the key reasons to act before the new rates come into effect:
- Avoid Higher Upfront Costs: As seen in the example above, even moderately priced properties will attract more tax under the new rates. Acting now allows you to secure your investment while paying less in stamp duty.
- Maximise Your ROI: The higher the upfront costs, the lower your return on investment (ROI) could be. Avoiding the upcoming increase in SDLT ensures your investment remains as profitable as possible.
- Increased Market Competition: As the April 2025 deadline approaches, we expect a rush of buyers eager to complete purchases before the higher stamp duty rates come into force. Getting ahead of this surge could mean securing better deals now, before competition intensifies.
- Interest Rates and Affordability: In addition to higher stamp duty rates, there is the potential for further interest rate rises, which could further increase the cost of financing your investment. Acting now allows you to lock in current rates and avoid future volatility.
Conclusion
For savvy property investors, the current stamp duty relief presents a valuable opportunity that won’t last forever. With the April 2025 increase in SDLT just around the corner, now is the time to act. Delaying your investment could mean paying thousands more in taxes, reducing your profit margins and making it harder to grow your property portfolio.
Don’t Wait Until 2025 – Save Now!
If you’re ready to take advantage of the current stamp duty rates, reach out to our expert team today on +44 (0) 113 380 8930. We can guide you through the best property investment opportunities available, helping you secure your next property before the higher SDLT rates come into effect.
