In recent years, rising property prices and interest rates have made it more difficult to get onto the property ladder.
Indeed, according to Uswitch, the average age of first-time buyers in England rose to 34 in 2022-23.
Fortunately, if you’re looking to buy your first home, then financial help is available.
In this article, we’ll explain what first-time buyers’ relief (FTBR) is and how you can apply to receive it.
Who qualifies as a first-time buyer in the UK?
To qualify as a first-time buyer, you must not have owned property anywhere in the world before.
You will not qualify if you’ve been gifted or inherited a residential property in the past.
You can only receive first-time buyer relief if you are buying a single property that you intend to use as your home.
You cannot claim FTBR on a buy-to-let or commercial property, or for properties that cost more than £625,000.
If you’re making a joint purchase, the other person will also need to meet the criteria of a first-time buyer.
If you’re not sure if you qualify for the relief, our mortgage advisors can provide straightforward advice.
What is first-time buyers’ relief?
When buying property, you must pay Stamp Duty Land Tax (SDLT) on the property’s purchase price unless you are eligible for tax relief.
First-time buyer relief can eliminate, or reduce, the amount of stamp duty first-time buyers pay.
If you buy a property for less than the threshold where SDLT starts to apply, then there’s no SDLT to pay.
Up until March 31 2025, those eligible for FTBR buying a property up to the price of £425,000 aren’t required to pay any stamp duty.
Those buying a property that costs between £425,000 and £625,000 must pay stamp duty at a rate of 5%, but only on the amount over £425,000.
From April 1 2025, the threshold at which SDLT is due for a first-time buyer is £300,000 when they’re buying a residental property worth £500,000 or less.
That means they’ll pay stamp duty at a rate of 5% on the portion between £300,000 and £500,000.
If the purchase price is higher than £500,000, then a first-time buyer cannot claim relief.
To learn more about Stamp Duty Land Tax, read the Government’s guidance here.
These figures were updated after the Chancellor of the Exchequer presented her Autumn Budget to Parliament on October 30, 2024.
Is first-time buyers’ relief still available?
Yes, as of October 2024, first-time buyer relief is still available to those who meet the eligibility criteria.
What benefits do I get as a first-time buyer?
Because getting on the property ladder is difficult at the moment, there are several schemes in place to help first-time buyers.
In addition to first-time buyer relief, first-time buyers may also be eligible for a Lifetime ISA to help them save for their first home.
The First Homes Scheme offers eligible first-time buyers a discount on new-build homes.
If you’re not sure which option is most suitable for your personal and financial circumstances, one of UKMC’s mortgage advisors will be happy to identify your options.
How to get first-time buyers’ relief
First-time buyers’ relief can be claimed by filling out a Stamp Duty Land Tax return and submitting it within 14 days of the property purchase.
You will need to submit a return even if no stamp duty is due.
Usually, your solicitor or conveyancer will fill out and submit your return for you. If you’re eligible for relief, always confirm with your solicitor or conveyancer that they’re going to claim it for you.
At UKMC, we want to ensure that buying your first home is an exciting experience, not a stressful one.
For support and guidance with getting your first mortgage, please fill out our contact form, and one of our team will contact you.
DISCLAIMER
UK Mortgage Centre Limited is an Appointed Representative of Refresh Mortgage Network Limited.
Refresh Mortgage Network Limited is authorised and regulated by the Financial Conduct Authority. We are entered on the Financial Services Register under firm number 1019794.
As a mortgage is secured against your home, it could be repossessed if you do not keep up the mortgage repayments. The Financial Conduct Authority does not regulate some forms of buy-to-let mortgages.
The Financial Conduct Authority does not regulate will writing and taxation and trust advice.
You may be charged a fee for your advice. A typical fee is £495, which would be payable when you receive your mortgage offer. Your dedicated advisor will discuss this further on your free initial phone call.
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