Can You Save £12,500 on Your Next Home? Yes, If You Know Where to Look.

Stamp duty is one of the biggest hidden costs when buying property. For many buyers, this tax can add tens of thousands to their total budget or even push a dream home just out of reach.

At Entralon, we believe smarter real estate decisions begin with better knowledge. In this article, you’ll discover practical, legal ways to reduce your stamp duty burden and how to find properties that fit within tax-saving thresholds.

Let’s dive in.

What Is Stamp Duty? How Much Do You Pay?

Stamp duty is a property tax charged on real estate transactions in countries like the UK, Australia, and India. In the UK, it’s formally known as Stamp Duty Land Tax (SDLT).

How much you pay depends on:

  • The property’s price
  • Whether you’re a first-time buyer or not
  • The type of property (residential vs. commercial)
  • Your country or region

Stamp Duty Tax Bands (Effective from April 2025)

For standard buyers:

  • £0 – £125,000: 0%
  • £125,001 – £250,000: 2%
  • £250,001 – £925,000: 5%
  • £925,001 – £1.5 million: 10%
  • Over £1.5 million: 12%

For first-time buyers:

  • £0 – £300,000: 0%
  • £300,001 – £500,000: 5%
  • (Properties above £500,000 no longer qualify for first-time buyer relief.)

Why Stamp Duty Reduction Matters?

Here’s what SDLT could look like on a typical UK property:

A £500,000 home now incurs £13,750 in SDLT for a standard buyer, reflecting the revised 2% rate on the £125,001–£250,000 bracket.

That’s money you could use for:

  • Renovations
  • Furnishing your home
  • Building equity through smart investments

Minimising your stamp duty means greater affordability and flexibility, especially in competitive markets like London.

1. First-Time Buyer Relief

As of April 2025, first-time buyers in the UK are exempt from SDLT on properties up to £300,000.

For homes priced between £300,001 and £500,000, a 5% rate applies on the portion above £300,000.

Properties over £500,000 no longer qualify for first-time buyer relief.

This means your maximum potential saving is now £5,000 instead of £11,250.

Looking for homes under the relief threshold? Explore listings on Entralon built for first-time buyers.

2. Buy Just Under a Threshold

A property priced at £249,999 attracts lower tax due to falling just below a threshold. At £250,000, you now pay around £2,500, based on the 2% rate on the portion from £125,001 to £250,000.

3. Claim a Refund (If You’re Upgrading)

If you bought a new home before selling your old one, you likely paid the 5% second home surcharge (as updated in April 2025).

Good news: If you sell your old home within 36 months, you can apply to HMRC for a refund of that extra tax, as long as your new home is now your main residence.

4. Buy Commercial or Mixed-Use Property

Stamp duty on commercial property is much lower:

  • 0% on the first £150,000
  • 2% up to £250,000
  • 5% above that

Properties that combine residential and commercial use (e.g., a shop with a flat above) often qualify for these lower rates.

5. Use Shared Ownership Schemes

Shared ownership lets you buy 25–75% of a home and rent the rest.

You only pay SDLT on your share of the property. You can pay the full tax later if you increase your stake (staircase).

6. Build Your Own Home

Buying land and building your home? You pay stamp duty only on the land, not on the value of the completed home.

This route can be complex, but for the right buyer, it offers long-term value and tax efficiency.

7. Property Transfers Without a Mortgage

In the UK, if you receive a property as a gift or inheritance with no mortgage involved, you usually pay no stamp duty.

However, if there’s an existing mortgage and you take on responsibility for it, you may be liable.

Avoid These High-Risk Stamp Duty Tricks

Reducing your tax legally is smart. Avoiding it through loopholes can be dangerous.

HMRC has cracked down on:

  • Overstating the furniture/fixtures value to reduce the property price
  • Using shell companies or sub-sales to avoid duty
  • Claiming a residential home is commercial when it’s not

Always consult a tax advisor or conveyancer before making decisions.

Final Thoughts And Your Next Step

Stamp duty can be a hurdle or an opportunity. With the right strategies, you can save thousands legally and safely.

And with Entralon, you don’t have to guess where to start.

We help buyers find properties that fit their budget, qualify for tax relief, and match their lifestyle, whether in London or Dubai.

Ready to explore homes under the tax threshold?

Start your search now at entralon.com or talk to one of our property experts for free.