First-time buyer stamp duty relief explained

First-time buyer relief is a reduced rate of Stamp Duty Land Tax for people buying their first home in England or Northern Ireland. Eligible buyers pay nothing on the first £300,000 and 5% on the portion up to £500,000 (GOV.UK, accessed 20 Oct 2026). It applies only when the home will be the buyer's main residence.

The relief is not automatic. It is claimed on the SDLT return, which the conveyancer usually completes and submits on the buyer's behalf.

A first-time buyer, for stamp duty, is someone who has never owned a freehold or leasehold interest in a home anywhere in the world, including through inheritance. Owning a share of a home, or a home abroad, counts as having owned one, even if it was only for a short time or was never lived in.

Joint purchases qualify only if every buyer is a first-time buyer. If one buyer has owned a home before, the whole purchase pays the standard rates, even if the other buyer has never owned property.

The relief has a price cap. If the price is more than £500,000, no first-time buyer relief is available and the standard residential bands apply to the whole price (GOV.UK, accessed 20 Oct 2026). There is no tapering: a price just over the cap pays the standard rates in full.

Buyers close to the cap sometimes negotiate on price, or on items such as furniture that may be bought separately at a fair value. Anything paid for the property itself counts towards the price.

Worked example, using example figures, not market data: a first-time buyer paying £400,000 pays nothing on the first £300,000 and 5% on the remaining £100,000, which is £5,000. A buyer who has owned a home before would pay £10,000 on the same price under the standard bands.

The residential stamp duty calculator works out both figures for any price, so first-time buyers can see the effect of the relief and of the price cap.

Shared ownership buyers can usually claim first-time buyer relief. They can choose to pay stamp duty on the full market value at the start, or to pay in stages as they buy more shares, and the choice affects whether the relief can be used. The conveyancer explains which option applies.

Buyers using deposit schemes or a family gift still qualify, as long as every person named on the purchase is a first-time buyer and the home will be their main residence.

First-time buyer relief is claimed by entering the relief code on the SDLT return. The conveyancer normally prepares the return, asks each buyer to confirm they have never owned a home, and pays any tax due. A false claim can lead to the tax being recovered with interest and penalties.

More on buying a first home, including how lenders assess first-time buyers, is in the first-time buyer mortgages guide.