How much extra you will pay for a house in Stamp Duty change from Thursday | Personal Finance | Finance

House buyers will face increased stamp duty taxes starting from tomorrow after Rachel Reeves announced the tax hike in Labour’s Autumn Budget today.

But an increase in stamp duty rates will only affect second-home buyers, landlords buying-to-let properties or commercial business properties, the Chancellor has confirmed.

From Thursday, second home buyers face a stamp duty rise of two percentage points, up from 3 percent to 5 percent.

Stamp duty is taxed in value based bands. For a first home worth up to £125,000 a first time buyer will pay no tax but this has been slashed from £250,000 – which means more people will end up paying more Stamp Duty.

If the property is valued at £125,000 to £675,000 the buyer will pay no tax on the first £125,000, and then 2 percent tax on any remaining value.

The next tax band is five percent from £675,000 to £925,000, then 10 percent on the next £575,000, then 12 percent on the remaining amount above 1.5M.

First time buyers were hit hard by Ms Reeves’ decision not to extend the relief for those buying their first home, which had been set at £425,000 on a temporary basis in 2022.

This means that from March 31 next year, the nil rate band will revert back to £125,000, meaning an extra 20% of first time buyers will have to pay more in stamp duty, according to experts.

On second homes, the bands are now five percent tax for over £125,000, eight percent for the next amount to £925,000, then 13 percent for £925,001 to £1,500,00 and 15 percent for any value above £1.5m.

It means a second home buyer pays £6,250 for a £125,000 property but a first time buyer would pay only £2,500.

“This will support over 130,000 additional transactions from people buying their first home, or moving home, over the next five years,” Chancellor Rachel Reeves pledged during her Budget.