LBTT replaced Stamp Duty Land tax (SDLT) for land transactions, including purchase of dwelling houses, in Scotland from 1 April 2015.

Two recent changes have been made to the LBTT rules, which may be of benefit to Scottish home buyers.

Firstly, a new LBTT relief has been introduced for first-time buyers of dwellings in Scotland which the buyer, or buyers intend to occupy as their only or main residence.

A first-time buyer is someone who has never previously owned a dwelling, either in Scotland or anywhere else in the world. Where more than one buyer is involved, all must be first-time buyers for the relief to be available.

The relief is available for transactions taking place on or after 30 June 2018, and where the contract was entered into on or after 9 February 2018.

The new relief raises the LBTT Nil rate band for first-time buyers from £145,000 to £175,000. This means that first time buyers pay no LBTT on a property worth up to £175,000, while first-time buyers buying a more expensive property receive a discount of £600 on their LBTT bill.

In addition, the rules extending relief from Additional Dwelling Supplement (ADS) for spouses, civil partners or co-habitants who jointly purchased a new main residence to replace a main residence they both lived in, but which was owned by only one of them, have been given retrospective effect back to the introduction of ADS on 1 April 2016.

Previously this relaxation applied only for purchases taking place on or after 30 June 2017. So if you paid ADS on such a purchase before 30 June 2017 you may now be able to reclaim this from Revenue Scotland.

If you wish to discuss these issues, and understand if you may benefit from these changes, please contact Colin McHardy.

0141 886 6644 | 01738 441 888

The information in this blog should not be regarded as financial advice.  This is based on our understanding in June 2018. Laws and tax rules may change in the future. Campbell Dallas is not responsible for content contained on third party sites.