There will be a sharp increase in Stamp Duty Land Tax (SDLT) – the Government’s tax on buying a home in England and Northern Ireland – from 1 April. Temporary concessions, which began in September 2022, expire on 31 March, adding thousands of pounds to the cost of most purchases.

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The threshold where the tax normally starts will fall from £250,000 to £125,000, which adds up to £2,500 on to the tax due. For first-time buyers, the threshold where SDLT begins will be cut from £425,000 to £300,000, and the maximum price for a home where this relief can be claimed is reduced from £625,000 to £500,000.

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The rules for being counted as a first-time buyer are very strict. If you’ve ever owned any interest in any residential property anywhere in the world, then you’re not a first-time buyer. If you’re buying jointly, you must both pass this test. However, if only one of you is buying the property, even if you are married or in a civil partnership, the other does not have to fulfil the condition.

If the sale price includes fixtures or fittings – anything attached to the building – or other items such as removable furniture or carpets, they are subject to SDLT. Removable items can be paid for separately and deducted from the price before SDLT is worked out, but only at their second-hand market value, which is likely to be low and make little difference to the tax due. Beware of anyone offering a scheme to reduce SDLT. They do not work, and you will end up paying extra tax – and possibly fines as well.

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The date that determines the rate of SDLT is completion. If you’re in the process of buying a home, it’s important to achieve that by 31 March. If you complete on 1 April or later, the new rates will apply. (A rise from 3% to 5% in the additional rate of SDLT charged on purchasing a second home, including buy-to-let property, began on 31 October.) There’ll be no April changes in the Scottish Land and Buildings Transaction Tax nor the Land Transaction Tax applicable in Wales. Moneyhelper.org.uk has calculators to work out the tax due.

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