From 1 April 2015 Stamp Duty Land Tax (SDLT) was replaced, in Scotland, by the Land and Buildings Transaction Tax (LBTT). The initial tax rates and bands for residential property are shown in the table below.
|Up to £145,000||–|
|£145,001 to £250,000||2.0%|
|£250,001 to £325,000||5.0%|
|£325,001 to £750,000||10.0%|
|£750,001 and over||12.0%|
The tax burden has been reduced or removed on lower value properties with the tax burden on larger, more expensive, properties being increased. Compared with SDLT immediately before 1 April 2015, you pay less tax on houses valued at £333,000 and more for properties above that figure.
The big difference between LBTT and SDLT is that you only pay the prescribed rate of tax on the part of the price above the band, unlike the old system where, once you moved into the next price band, tax at the increased rate was payable on the whole purchase price. This effect distorted the market for property being sold close to a change in price band.
A calculator to help you work out how much LBTT you have to pay is available on the Revenue Scotland website: https://www.revenue.scot/land-buildings-transaction-tax/tax-calculators
Our property solicitors can fully advise you on all aspects of LBTT.