Book a Property Valuation
logo

Changes to Land and Buildings Transaction Tax explained

Posted on: Wednesday, July 15, 2020

As of 15 July, the Scottish government is cutting the rate of its devolved Land and Buildings Transaction Tax (LBTT), with the threshold increasing from £145,000 to £250,000 until 31 March 2021.  

There will be no LBTT paid on homes up to £250,000, 5% on homes priced from £250,001 to £325,000, 10% on homes from £325,001 to £750,000 and 12% on homes over £750,000. This will mean that residential property transactions, where the purchase price is under £250,000, and to which the Additional Dwelling Supplement (ADS) does not apply, will attract no LBTT.  

Visit gov.scot for more information 

For transactions where the purchase price is above £250,000, the rates and thresholds that usually apply to the proportion of the purchase price above that amount remain unchanged. 

According to the legislation introduced to the Scottish Parliament, the revised rates and bands will apply to all relevant transactions where the effective date is between 15 July 2020 and 31 March 2021, inclusive of these dates. 

Guild Member, Alyson Lowe from Alexander Taylor in Scotland, says the change is good news for the Scottish property market: “Finally, the Scottish Government have given us a precious gift of raising the LBTT figure from £145,000 to £250,000. This is massive to the economic growth of the country and particularly the property sector. A huge 80% of transactions in Scotland are under £250,000, which means the change will have a significant impact to market and buyers moving forward. The jump from £145,000 to £250,000 means around 34% more transactions will no longer pay LBTT.” 

In April 2015, LBTT replaced Stamp Duty Land Tax (SDLT) in Scotland. While the Scottish government faced some criticism over its delayed reaction to the earlier announcement of the changes to SDLT In England and Northern Ireland earlier this month, changes are now welcomed by the sector with open arms.  

 

Additional Dwelling Supplement  

ADS is an additional amount of LBTT payable on the purchase of a second residence in Scotland. Where the ADS does apply, the change to the starting threshold will also apply to such transactions. This means that a residential property transaction that is liable to the ADS will not pay the standard rates of LBTT on the first £250,000 of the purchase price, however, the ADS will remain payable at 4% of the total purchase price. 

“What a time we have all come through, we will forever remember 2020 as the year where our very existence has changed beyond anyone’s predictions. Hopefully, this encouraging announcement about LBTT will ignite the Scottish property market and will help a lot of people make a positive change this year,” Lowe concludes.

 

Calculate LBTT 

Are you looking to buy property in Scotland to benefit from the new LBTT rates? Find out how much LBTT you’ll have to pay using our online calculator. 

 

What Our
Clients Say

"

I would highly recommend Hardings. Their knowledge of the local area is outstanding, and they give honest and reliable advice. They have always been my partner of choice when buying and selling.

Rhiannon Prothero

"

Have used Hardings for many year on both personal and commercial property deals. Have always found them to be transparent, honest, authentic, and a pleasure to work with. Will continue to use in the future.

TB

"

I would highly recommend Hardings Estate Agents. They have excellent knowledge of Windsor and the surrounding areas, and are extremely professional, responsive and courteous. I would not hesitate to using them again the future. I recently dealt with Milica who was instrumental in securing us our new home in Windsor as well as the sale of our existing property. She was a fab negotiator and a real pleasure to work with from beginning to end. Thank you!

Jonathon Beresford

"

Hardings of Windsor managed our purchase with complete professionalism and went over and above in my opinion to manage the transaction and chain, resulting in a really smooth purchase. Milica at Hardings constantly provided timely updates and managed respective solicitors and the chain effectively, always responding quickly to queries. The whole transaction would not have happened without Milicas' focus on making all parties comfortable and satisfying all queries, not only professional but a delightful and welcoming personal approach that was a constant throughout. Thanks Hardings! Thanks Milica!

Stuart Blatch

"

I would recommend using Hardings estate agents when buying or selling your property. Dominic (Scully) was always available, helpful and genuinely interested in my purchase and always calm and compassionate. If I ever move again my first choice will be Hardings.

Cath Powell

"

Dom and the team at Hardings were so helpful and efficient when I purchased my flat - friendly and professional service and kept us up-to-date the whole way through the process. It was my first time buying and so was very nervous but they helped me feel at ease.

Freppell

"

We bought and sold through Hardings and can't recommend their professional service enough. The whole Team are really lovely, we were kept informed throughout the process and never had to chase anything.

Natalie Quint

"

I used Hardings when I bought my property as well as when I sold it and the service has been fantastic both times. I very much recommend Hardings!

Therese Jouini

"

We recently purchased our new home with Hardings Estate Agents. The whole team there were very helpful and flexible with us, arranging viewings quickly on the same day. They were always quick to respond and if ever our point of contact was not there, the service did not change as they work well together as a team. We received a personalised service, which allowed the sale to proceed quickly. Thank you all and we recommend Hardings Estate Agents without hesitation.

Mike B

"

What a pleasure it was to deal with Milica from Hardings. She sourced the perfect property for me and my family (while we were still abroad) and worked endlessly to put the deal together. I would give more than 5 stars if at all possible!

C D

"

Fantastic customer service and made what could have been stressful a total breeze. Dominic and Louisa were brilliant in helping me and my parents buy and sell our houses - reliable, helpful and thoughtful. Thank you!

Eloise Harris

"

Thank you, Dominic and Louisa - having not moved for over 30 years you helped me all the way, step by step. You were always polite, communicative, reassuring and very supportive. Would recommend Hardings wholeheartedly.

Anna Bowen
How Much is Your Property Worth?

How Much is Your Property Worth?

A senior member of our sales team will visit your property to discuss current market trends and how your home; based on size, condition and location should be pitched to achieve the best possible price and buyer. Coupled with an excellent understanding of the local market we do a detailed analysis of what else has sold and what is coming onto the market so we can give you the best chance to capitalise on your biggest asset.

Book a Valuation