In brief
- First-time buyers in England pay a reduced SDLT rate at £400,000 — the full relief ceiling is £425,000.
- Standard residential buyers pay SDLT at 2% and 5% rates across the £400,000 price.
- Second home buyers face a substantial additional supplement — complete cash discipline is essential.
- Scotland and Wales apply different land transaction taxes — use the calculator for your nation.
Definition in plain English
A £400,000 purchase sits below the first-time buyer upper relief ceiling, making buyer type comparison especially important at this price.
Context
Use this guide to benchmark £400,000 scenarios and test sensitivity around the first-time buyer and second-home thresholds.
Use the calculator for this topic
Run multiple price points and buyer types before setting your final offer ceiling. Keep all assumptions visible in one place so comparisons stay honest.
Worked examples (home mover, typical fees)
First-time buyer relief at £400,000
In England, first-time buyer relief applies to properties up to £500,000. The relief gives a 0% rate on the first £425,000, then 5% on the remainder up to £500,000.
At £400,000, a first-time buyer pays 0% on the full amount — the entire purchase price falls within the £425,000 relief ceiling. This is a meaningful saving versus standard rates.
Both buyers must qualify as first-time buyers when purchasing jointly. A previous homeowner co-buying removes the relief entirely.
Standard and second-home rates at £400,000
Standard residential buyers in England pay 0% on the first £125,000, 2% on £125,000–£250,000 and 5% on £250,000–£400,000. Use the calculator for the precise figure.
Second home and buy-to-let purchases attract the additional dwelling supplement on every pound. At £400,000 this creates a large gap between standard and higher-rate scenarios.
If you're purchasing as an investment or retaining another property, model the higher rate carefully before offering.
Sensitivity: why £400k versus £425k matters
For first-time buyers, the difference between a £400,000 and £425,001 purchase is minimal in SDLT terms — both attract 0% under first-time buyer relief.
For standard buyers the difference is more significant. Negotiating from £425,000 to £399,999 saves nothing on SDLT for standard buyers but could if the price crossed the 5% band threshold.
Run both prices in the calculator before finalising your offer ceiling to confirm whether negotiation headroom changes the tax outcome.
Decision framework used by careful buyers
Start with an offer ceiling based on total cash, not headline house price. In practice, buyers who only track deposit and mortgage payments can miss the transaction-cost layer, which is exactly where completions become stressful.
Use a three-pass approach: first estimate tax by nation and buyer type, then add realistic fees, then pressure-test the result by increasing the offer by £10,000 and £25,000. This shows how sensitive your budget is before bidding.
Treat the model as a planning instrument. Final legal liability always sits with official calculators and your conveyancer’s completion statement, but early visibility reduces avoidable surprises.
Practical checklist before making an offer
Confirm your likely buyer status first (home mover, first-time buyer, or additional property). Switching status can alter tax materially at the same price point, so this should be fixed before negotiating.
Collect at least two conveyancing quotes and check what is included. Buyers often compare legal fees without checking disbursements, search packages, leasehold supplements or transfer fees.
Keep a contingency buffer instead of budgeting to the exact minimum. A modest reserve can protect timelines when valuation, legal or lender admin costs move late in the process.
Frequently asked questions
How much stamp duty on £400,000 for a first-time buyer in England?
Zero — at £400,000 the entire purchase price falls within the first-time buyer relief ceiling of £425,000, so no SDLT is due. Both buyers must be first-time buyers if purchasing jointly.
How much SDLT does a standard buyer pay on £400,000?
Standard residential SDLT on £400,000 in England applies at 0% on the first £125,000, 2% on the next £125,000 and 5% on the remaining £150,000. Use the calculator for the exact total.
Is £400,000 within the first-time buyer relief window?
Yes. First-time buyer relief in England applies on purchases up to £500,000. The 0% rate covers the first £425,000. A £400,000 purchase falls entirely within that 0% ceiling.
What does stamp duty cost on a £400,000 second home?
Second home buyers pay standard SDLT rates plus the additional dwelling supplement on the full purchase price. Use the calculator with 'second home' selected for the current figure.
References
- GOV.UK: Stamp Duty Land Tax — Primary SDLT rates and process guidance.
- Revenue Scotland: LBTT — Official LBTT rates and ADS information.
- Welsh Revenue Authority: LTT — Official LTT rates and higher-rate guidance.
For methodology and editorial policy, see Methodology and Editorial standards.