First-time buyer stamp duty relief: the £500,000 price limit
The short answer
First-time buyer relief has a £500,000 maximum. Check the total for any linked purchases, not just one contract price.
- One unlinked purchase is tested on its own
- Linked purchases are added together
- Over £500,000 means no relief for those purchases
Scroll down for the full analysis.
Read the original guidance here:
First-time buyer stamp duty relief: the £500,000 price limit
First-time buyer stamp duty relief: the £500,000 price limit
For first-time buyer stamp duty relief, the amount used for the test must not be more than £500,000. If the amount is even £1 over, you cannot claim this relief. A related purchase can push you over the limit too.
What this rule is about
This condition applies to first-time buyer relief from Stamp Duty Land Tax, or SDLT. It is not the whole test. You must still meet the relief’s other conditions.
The key phrase is “relevant consideration”. In everyday terms, the law uses this amount when it checks whether the transaction, including linked purchases that must be added, stays within the £500,000 cap. That is the limit.
What the official source says
HMRC’s manual includes in this test the normal amounts that count for SDLT, while it says that rent due under a lease does not count. That distinction matters.
- For one purchase that is not linked to another, test that purchase on its own.
- For linked purchases, add the amounts for every linked purchase.
- If that combined figure is more than £500,000, none of those purchases gets the relief.
What this means in practice
Do not look only at the figure on one contract. Ask whether, alongside the purchase before you, you are buying another piece of land as part of the same deal or a series of deals. Check before deciding.
- Check all payments and other things you are giving for the property.
- Check whether more than one contract forms one overall arrangement.
- Keep the papers that show how you worked out each amount.
What makes purchases linked? The legislation asks whether a single scheme, arrangement or series exists between the same buyer and seller, or between people connected to them for the transactions. Names do not decide it. Calling them separate deals does not settle the question.
How to analyse it
Work through the point in this order. People usually miss the link between transactions.
- Confirm that the property is in England or Northern Ireland.
- Work out whether this first-time buyer relief is otherwise available.
- Identify everything that counts towards the SDLT amount.
- If there are linked property purchases, add the relevant figures.
Example
Amir buys a flat for £499,000 and has no related property purchase. On the figures alone, he is below the £500,000 cap. That does not by itself prove that he gets relief.
Now change one fact. Amir buys the flat for £250,000 and a parking space from the same seller for £251,000 as part of one arrangement. The total is £501,000. If the purchases are linked, neither qualifies for the relief.
Why this can be difficult in practice
A round number can give false comfort. The amount is not always just the cash price shown in an estate agent’s listing.
- A separate contract may still be part of the same overall deal.
- Payments in money or money’s worth can matter, not only cash.
- Check HMRC’s statement about lease rent against the law in force on the transaction date.
Key takeaways
- The cap is £500,000, not £500,001.
- Linked purchases are added together.
- This limit is only one part of the relief test.
Technical analysis
For advisers, and for anyone who wants to check the law behind this page. You do not need this section to understand the guidance above.
Legislation
- FA 2003 Schedule 6ZA para 1 — the £500,000 limit for this relief
- FA 2003 Schedule 6ZA para 7 — how relevant consideration is calculated
- FA 2003 section 108 — when land transactions are linked
- FA 2003 Schedule 4 para 1 — what payment counts for stamp duty
Official guidance
The pages below are HMRC’s guidance. Guidance is not law. It sets out how HMRC reads the legislation, and it is not binding on you, on a tribunal or on a court. Where guidance and the legislation differ, the legislation wins. HMRC can also change or withdraw guidance, and it may not cover your facts.
Where this is not settled
- The supplied current statutory text defines relevant consideration by reference to chargeable consideration, but does not expressly repeat the manual’s statement that lease rent is excluded. The position should be checked against current primary legislation for the transaction date.
Evidence you would need
This kind of case is decided on the facts of the individual property. These are the records that usually settle it, and the ones an adviser would ask you for.
- The contract, transfer and any documents showing everything given for the property.
- Details of any related purchases from the same seller or connected sellers.
- Lease terms showing any premium and rent.
Explore this with an AI
Readers often want to test their own situation. Copy the prompt below into ChatGPT, Claude or Gemini. It hands the model the actual legislation for this page rather than letting it answer from memory, and tells it to be explicit about what is uncertain. What comes back is information, not advice – check it against the links above.
I am researching UK Stamp Duty Land Tax (SDLT), which applies in England and Northern Ireland. MY QUESTION First-time buyer stamp duty relief: the £500,000 price limit [Replace this with your own situation: what you are buying, the price, the dates, who the buyer is, and what you plan to do with the property.] THE LAW THIS TURNS ON - FA 2003 Schedule 6ZA para 1 - the £500,000 limit for this relief https://www.legislation.gov.uk/ukpga/2003/14/schedule/6ZA/paragraph/1/2025-11-17 - FA 2003 Schedule 6ZA para 7 - how relevant consideration is calculated https://www.legislation.gov.uk/ukpga/2003/14/schedule/6ZA/paragraph/7/2025-11-17 - FA 2003 section 108 - when land transactions are linked https://www.legislation.gov.uk/ukpga/2003/14/section/108/2025-11-17 - FA 2003 Schedule 4 para 1 - what payment counts for stamp duty https://www.legislation.gov.uk/ukpga/2003/14/schedule/4/paragraph/1/2025-11-17 HMRC's guidance page on this topic (guidance, not law): https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm29825 HOW I WANT YOU TO ANSWER 1. Work from the legislation above. Read it before answering. HMRC guidance is HMRC's view of the law, not the law, and does not bind a tribunal or a court. 2. Tell me what the rule actually requires, in plain English. 3. Tell me which facts decide the answer, and which facts would change it. 4. Tell me what evidence I would need to support the position. 5. Be explicit about anything unsettled or fact-sensitive. Do not guess. 6. Your training data has a cutoff and SDLT rates and reliefs change at fiscal events. Say so if you are not sure the law is current. POINTS ALREADY KNOWN TO BE UNCERTAIN ON THIS TOPIC - The supplied current statutory text defines relevant consideration by reference to chargeable consideration, but does not expressly repeat the manual's statement that lease rent is excluded. The position should be checked against current primary legislation for the transaction date. Do not give me a conclusion you cannot support from the provisions above.
Legislation links show Finance Act 2003 as it stood on 2025-11-17. The law may have changed since, and the rules that apply are those in force on the date of your transaction. The official guidance this page is based on is here.
This page was last updated on 1 September 2026
Useful article? You may find it helpful to read the original guidance here: First-time buyer stamp duty relief: the £500,000 price limit
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