The starting threshold for Land and Buildings Transaction Tax ( LBTT) on residential property sales in Scotland is rising from £145,000 to £250,000 from 15 July 2020 until  31 March 2021.

This amounts to over £2000 in savings on a property bought for £250,000 and means that where the Additional Dwelling Supplement (ADS) does not apply, no LBTT will be payable.

To find out how this change affects you, click on the relevant link below:

I’m a first time buyer and I’m buying a property costing less than £250,000

Good news – you’ll pay no LBTT at all on your purchase, as long as your purchase is AFTER 15 July and BEFORE 31 March 2021.  All other legal fees and outlays remain unchanged. The changes to LBTT have no impact on Help To Buy (Scotland) or the First Home Fund.

I’m a first time buyer and I’m buying a property costing more than £250,000

You will pay LBTT, but NOT on the first £250,000 of the purchase price (as long as your purchase is AFTER 15 July 2020 starts and BEFORE 31 March 2021).  You can work out your LBTT as follows:

  • The first £250,000 of purchase price             0%
  • Then £250,001 - £325,000                              5%
  • Then £325,001 - £750,000                                10%
  • Then over £750,000                                        12%

The changes to LBTT have no impact on Help To Buy (Scotland) or the First Home Fund.

I already own a property, but I would like to purchase another one costing LESS than £250,000

You will not incur any of the standard Land and Buildings Transaction Tax, but you will be liable for the ‘Additional Dwelling Supplement’, which is at 4% of the total purchase price.  For example, if you buy a property at £100,000, you’ll pay an ADS of £4000.

I already own a property but I would like to purchase another one costing MORE than £250,000

If you purchase between 15 July 2020 and 31 March 2021, you can work out your LBTT as follows:

  • The first £250,000 of purchase price             0%
  • Then £250,001 - £325,000                              5%
  • Then 325,001 - £750,000                                10%
  • Then over £750,000                                        12%

In addition, you will be liable for the ‘Additional Dwelling Supplement’, which is 4% of the total purchase price.  For example, if you buy a property at £300,000, you’ll pay an ADS of £12000


 

You can read more about the Scottish Government’s plans on their website.  

If you have any other questions, please get in touch and discuss this with one of our solicitors.