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First Time Buyers Relief | Benefits and Eligibility Requirements


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Purchasing your first home is an exciting milestone in life, but it can also come with financial burdens. To alleviate some of these costs, governments often provide relief measures to first-time buyers.

In the United Kingdom, one such benefit is the First Time Buyer Relief scheme, which offers discounts on Stamp Duty Land Tax (SDLT). This article aims to provide a comprehensive breakdown of the benefits and eligibility requirements associated with the First Time Buyer Relief.

Understanding First Time Buyers Relief

The First Time Buyer Relief is a scheme introduced by the UK government to support individuals who are purchasing their first home.

The relief is designed to help alleviate the burden of SDLT, which is a tax paid when purchasing property. Under the First Time Buyer Relief, eligible first-time buyers can claim a discount or relief on the SDLT payable, subject to specific conditions.

Eligibility Requirements for First Time Buyers Relief

Eligibility Requirements for First Time Buyer Relief

To qualify for the First Time Buyers Relief, several conditions must be met:

1. The Property

The transaction must involve the main ownership of a single home, main ownership here refers to dwelling being purchased.

However, if the transaction involves a lease with less than 21 years left at the beginning of the day after the effective date of the transaction, it won’t be considered a significant ownership interest.

2. Consideration Amount 

The relevant consideration for the transaction (excluding rent) should not exceed £625,000. “Relevant consideration” means:

  • For a single transaction that is not linked to other transactions, it refers to the amount of money or value involved in that particular transaction.
  • For a transaction that is linked to other transactions, it refers to the total amount of money or value involved in all those linked transactions combined.

3. First-Time Buyer Status

 The purchaser, or each of the purchasers if there are multiple buyers, must be a first-time buyer. This means they have never owned a property before and intend to occupy the purchased dwelling as their only or main residence.

4. Linked Transactions

 The transaction must not be linked to another land transaction, except for specific cases where the land is directly related to the purchased dwelling (e.g., garden or grounds).

Exclusions and Higher Rates Transactions:

It’s important to note that relief under the First Time Buyer Relief cannot be claimed for properties priced above £625,000.

In such cases, first-time buyers must follow the SDLT rules applicable to those who have previously owned a home. Additionally, relief may not be available if the transaction is classified as a higher rates transaction under Schedule 4ZA.

Benefits of First Time Buyers Relief

Understanding the Benefits of First Time Buyer Relief

By meeting the eligibility criteria, first-time buyers can enjoy the following benefits under the First Time Buyer Relief:

1. No SDLT up to £425,000 

First-time buyers are entirely exempt from paying SDLT on properties priced up to £425,000, resulting in significant savings. This can result in significant savings and reduce the overall cost of purchasing a home.

Make sure you check out our First Time Buyer Relief Calculator which can help you estimate your potential SDLT savings with the relief applied.

2. 5% SDLT Relief

For properties priced between £425,001 and £625,000, a discounted rate of 5% SDLT is applicable on the portion above £425,000. This lower rate helps make the purchase more affordable compared to the standard SDLT rates.

3. Financial relief

The First Time Buyer Relief provides financial relief specifically targeted at first-time buyers. It acknowledges the challenges faced by individuals entering the property market for the first time and aims to ease the burden of SDLT, which is a significant cost associated with buying a home.

4. Increased affordability

By reducing or eliminating the SDLT burden, the First Time Buyer Relief increases the affordability of homeownership for first-time buyers. It enables individuals and families to allocate their financial resources towards other essential aspects of homeownership, such as moving costs, renovations, or mortgage payments.

5. Incentive for homeownership

The First Time Buyer Relief serves as an incentive for individuals to take the important step of becoming homeowners. By providing financial relief, it encourages first-time buyers to enter the property market, fostering stability, and contributing to the growth of the housing sector.

Overall, the benefits of the First Time Buyer Relief for SDLT help alleviate the financial strain associated with purchasing a first home, making homeownership more accessible and affordable for individuals taking their initial steps on the property ladder.


First Time Buyers Relief scheme in the United Kingdom provides valuable benefits and financial relief to individuals purchasing their first home.

By meeting the eligibility requirements and satisfying the necessary conditions, first-time buyers can enjoy significant savings on SDLT. This scheme serves as an incentive for those stepping onto the property ladder and helps make the dream of home ownership more attainable. 

We understand that every first-time buyer’s situation is unique. Our accounting professionals will work closely with you to develop personalized strategies tailored to your specific circumstances. We’ll identify the most effective approaches to minimise your tax liability and optimise your first time buyers relief. 

Fill out our Assessment Form today and Get Peace of Mind.

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