Understanding Changes To Land and Buildings Transaction Tax

Amongst the many life decisions you will make, buying a house is one of the biggest and therefore one, which requires much time and consideration. With that said, we feel that not only is it important that you have all the information you require but also that, that information is reliable and up-to-date.

Changes to legislation are particularly relevant when buying a house as they may have a rather significant impact on your buying decisions. One of the most recent changes homebuyers may have experienced or may be interested in is that of the legislation surrounding stamp duty.

With changes first introduced in April of last year, stamp duty has now been replaced in Scotland, by Land and Buildings Transaction Tax, which is calculated according to the specific price bracket that the property you’re buying falls into.

New Rates

Changes such as these are important to consider when setting budget, as you may now be saving a significant amount of money, due to the new rates (listed below).

Up to £145,000 – 0%

£145,001 – £250,000 – 2%

£250,001 – £325,000 – 5%

£325,001 – £750,000 – 10%

£750,001 + – 12%

Further to this, new rates will be introduced as of April 1st 2016, which will involve a 3% surcharge for those buying additional residential properties, for purchase prices exceeding £40,000. This change in legislation applies to those, who for example, are interested in buy to let properties. The new rates are as below:

Up to £40,000 – 0%

£40,001 – £145,000 – 3%

£145,001 – £250,000 – 5%

£250,001 – £325,000 – 8%

£325,001 – £750,000 – 13%

£750,001 + – £15%

If you have any questions about Land and Buildings Transaction Tax or any other legislation regarding the purchase of a property, please contact our Conveyancing department on 0141 887 5271.