Why do people think first-time buyer stamp duty is free up to £425,000?

Because it used to be true, just not any more. Between 2022 and 1 April 2025, first-time buyers benefited from a temporarily raised threshold: 0% up to £425,000, with relief available on purchases up to £625,000. That relief expired and reverted to the older, lower bands: 0% up to £300,000, with relief ending altogether above £500,000. Plenty of blog posts, forum threads, and even some mortgage broker material written before April 2025 still quote the £425,000 figure because it simply hasn't been updated. If you're planning a purchase now, budgeting on the old figure means underestimating your completion costs by thousands of pounds, potentially derailing your finances at the worst possible moment. Always check GOV.UK directly or use an up-to-date stamp duty calculator rather than trusting an article, forum post, or friend's advice that doesn't state when it was written.

How much stamp duty will I pay as a first-time buyer on a £350,000 house?

On a £350,000 first-time buyer purchase in England or Northern Ireland, you'll pay £2,500 in Stamp Duty Land Tax under the current 2026 rules. That's because the first £300,000 is taxed at 0%, and the remaining £50,000 is taxed at 5% (£50,000 x 5% = £2,500). This is materially different from what you'd have paid under the temporary relief that ended 1 April 2025, when the same purchase would have cost £0 in Stamp Duty. If you're a joint buyer and only one of you counts as a first-time buyer, relief isn't available at all: HMRC requires every named buyer to be a genuine first-time buyer for the relief to apply to the purchase. Use our Stamp Duty calculator to check your own purchase price rather than assuming a round-number example applies exactly to you, since even a few thousand pounds either side of a band changes the total.

What happens to first-time buyer stamp duty relief above £500,000?

It disappears entirely, not just on the amount above £500,000. If your purchase price is £500,000 or below, you get first-time buyer relief on the whole amount: 0% to £300,000, then 5% up to £500,000. But cross £500,000 by even a small margin and HMRC applies the standard residential rates to the entire purchase price instead, with no first-time buyer discount at all. In practice that means a buyer at exactly £500,000 owes £10,000 in Stamp Duty, while a buyer just above it owes roughly £15,000, a jump of nearly £5,000 triggered by crossing a single threshold. If your target property is priced close to £500,000, that cliff edge is worth negotiating around directly, because a small reduction in the agreed price can be worth thousands of pounds more than it looks on paper.

The £425k stamp duty myth costing first-time buyers £6,250

Q: What is the first-time buyer stamp duty threshold in 2026?

First-time buyers in England and Northern Ireland pay 0% Stamp Duty Land Tax up to £300,000 in 2026, then 5% on the portion up to £500,000 (GOV.UK, confirmed unchanged since 1 April 2025). Buy above £500,000 and the relief disappears completely: you pay standard residential rates on the whole price instead, not just the portion above the cap. These thresholds apply only in England and Northern Ireland; Scotland uses Land and Buildings Transaction Tax with its own first-time buyer relief, and Wales uses Land Transaction Tax, which offers no separate first-time buyer relief at all. If you've seen a figure of £425,000 quoted anywhere, that's out of date: it was a temporary relief that ran from 2022 and ended on 1 April 2025. Always check the purchase price against these current bands before budgeting, and use a stamp duty calculator rather than relying on a figure you read a while ago.

You've seen the number everywhere: first £425,000 free of stamp duty if you're a first-time buyer. It's in old blog posts, it's what a mate who bought two years ago told you, and it's sitting in the budget spreadsheet you've been building for your own purchase. So you've pencilled in £0 for stamp duty on a £380,000 flat and earmarked that saved cash for your deposit instead. That's a mistake that could leave you short by thousands of pounds at exchange, because the £425,000 figure hasn't been true since April 2025.

The real first-time buyer threshold in 2026 is £300,000, not £425,000 (GOV.UK, confirmed unchanged since 1 April 2025). On that same £380,000 flat, you'd actually owe £4,000 in Stamp Duty Land Tax: money that needs to be sitting in your account on completion day, not spent on furniture or held back as a buffer.

The £425,000 figure everyone still quotes

The confusion isn't your fault. Between 2022 and 1 April 2025, a temporary relief genuinely did raise the first-time buyer nil-rate band to £425,000, with partial relief available up to £625,000. That was a real, government-confirmed rule for three years, long enough for it to get baked into calculators, blog posts, and casual advice from friends who bought during that window. It just isn't the rule any more.

When the temporary relief expired on 1 April 2025, the thresholds reverted to the lower bands that applied before 2022: 0% up to £300,000, with relief tapering out completely above £500,000 (GOV.UK; MoneySavingExpert). No further change has been announced for the rest of 2026, so this is the figure to plan around, not a placeholder. The reversion wasn't a fresh policy change either: the 2022 relief always had a built-in expiry date, so 1 April 2025 was that sunset clause activating exactly as planned, not a surprise cut.

So if any figure you're using for your own budget came from a source written before April 2025, it's wrong. Check the date on anything quoting £425,000 before you rely on it.

What the current rules actually charge you

Under the 2026 rules, first-time buyers in England and Northern Ireland pay 0% Stamp Duty Land Tax on the first £300,000 of a purchase, then 5% on the slice between £300,000 and £500,000 (GOV.UK). Above £500,000, first-time buyer relief stops applying altogether, and the standard residential rates take over instead, on the whole price, not just the excess.

Run the maths on a purchase at the old £425,000 ceiling that so many people still quote as tax-free: 0% on the first £300,000, then 5% on the remaining £125,000, comes to £6,250 in Stamp Duty. A more typical first-time buyer stretch purchase of £350,000 owes £2,500 (5% of the £50,000 above the threshold). Neither of those is the £0 that the old headline figure implies.

The maths, in one place:

First-time buyer Stamp Duty Land Tax at current 2026 rates (GOV.UK; England and Northern Ireland only) · £280,000 purchase = £0 · £350,000 purchase = £2,500 (5% of £50,000 above £300k) · £380,000 purchase = £4,000 (5% of £80,000 above £300k) · £425,000 purchase (the old "free" ceiling) = £6,250 (5% of £125,000 above £300k) · £500,000 purchase = £10,000, the maximum relief can save you · above £500,000: relief withdrawn entirely, standard rates apply to the full price.

So work out your own purchase price against these bands now, not on completion day. A £6,250 shortfall discovered a week before exchange is a genuinely bad place to find yourself.

The cliff edge at £500,000 that catches people out

There's a second, sharper myth hiding inside the first one: people assume that even above £500,000, you at least keep the relief on the portion under that line. You don't. Cross £500,000 and HMRC withdraws first-time buyer relief from the entire purchase, applying the standard residential bands (0% to £125,000, 2% to £250,000, 5% to £925,000) to the whole price instead.

The practical effect is a genuine cliff edge. A first-time buyer purchasing at exactly £500,000 owes £10,000 under the relief bands. A buyer purchasing just above that line owes roughly £15,000 under the standard bands, a jump of nearly £5,000 triggered by a small increase in price. If you're a first-time buyer searching in a market where £500,000 is within reach, negotiating even a modest reduction below that line is worth materially more than it looks on the surface. Our Stamp Duty calculator will show you exactly where your own purchase price lands against both sets of bands.

So if you're offering near £500,000, don't just think about the asking price. Think about which side of that line your final offer lands on, because it changes your tax bill by thousands of pounds either way.

Where this myth does the most damage: London and the South East

In large parts of the North and the Midlands, a typical first-time buyer purchase sits safely under £300,000, so this particular myth barely costs anyone real money. That isn't true everywhere. RICS's June 2026 survey specifically flagged the South East as one of the two regions under the greatest price pressure nationally (RICS UK Residential Market Survey, June 2026), and London's average house price sits at £553,000 (Land Registry UK HPI, April 2026), a full £53,000 above the point where first-time buyer relief disappears entirely.

Run the numbers across a realistic South East or outer-London price range and the gap between the old myth and current reality widens as the price rises, not narrows: a £400,000 purchase now owes £5,000 in Stamp Duty; a £450,000 purchase owes £7,500; a £480,000 purchase owes £9,000. Every one of those was meant to be entirely tax-free under the figure so many people are still quoting.

So if you're searching in London, the South East, or anywhere else first-time buyer prices regularly sit between £300,000 and £500,000, treat this as a real budget line rather than a rounding error, because it's a bill worth thousands of pounds.

Why this myth is more dangerous than the usual deposit confusion

Most stamp duty confusion is harmless because it makes people overestimate their costs and budget cautiously. This myth works the other way: it makes people underestimate a bill that has to be paid in full on completion day, alongside solicitor fees, moving costs, and often a mortgage arrangement fee. If you've read up on deposit myths that trip up first-time buyers, this is the same trap in a different disguise: a number that sounds generous, quoted without a date attached, sitting in your plan unchallenged.

It's also a nation-specific rule. These bands apply in England and Northern Ireland only. Scotland charges Land and Buildings Transaction Tax with its own first-time buyer relief and different bands entirely, and Wales charges Land Transaction Tax, which currently offers no separate first-time buyer relief at all. If you're buying outside England or Northern Ireland, none of the figures above apply to you directly, so check the equivalent Scottish or Welsh guidance before you budget.

So don't assume a stamp duty figure you've seen quoted applies to your purchase without checking both the date and the nation it refers to. Getting either one wrong changes your bill by thousands of pounds.

What this means for you

If you're budgeting for a first-time buyer purchase anywhere near or above £300,000, the maths points toward running your exact number through a current calculator today, not relying on a figure from a spreadsheet, a forum thread, or a mate's experience from a couple of years ago. Frankly, if your target purchase price sits close to £500,000, treat that line as a hard negotiating target during offers: finishing under £500,000 rather than over it can be worth thousands of pounds, not something to discover after your solicitor sends the completion statement. Use our affordability calculator alongside the Stamp Duty figures above to see the full picture of what you'll actually need on completion day, and once you've exchanged, our new homeowner checklist covers what else needs budgeting for in your first 30 days.