Oct 13, 2014
From 1st April 2015, property sales in Scotland will be liable to a newly announced Land and Buildings Transaction Tax (LBTT). The new rules confirm that transactions below £135,000 will not incur any LBTT whereas currently only transactions under £125,000 are free from Stamp Duty.
On property purchases between £135,000 and £250,000 a rate of 2% will apply HOWEVER, only on the amount between £135,000 and £250,000.
Between £250,000 and £1m is where the biggest changes will arise. You will pay 2% on the amount between £135,000 and £250,000 (ie £115,000 @ 2% = £2,300) but an additional 10% above £250,000. As an example, if you buy a property at £350,000 your LBTT payment will be £12,300 but under current rules it will be £10,500. The break point where LBTT is more than Stamp Duty Land Tax is just over £323,000.
On transactions over £1m the calculations will be as above with the LBTT rate increasing to 12% on the amount over the £1m mark.
We are, as always more than happy to chat any legislation changes through with you if you would like to call or pop into your local branch.