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Scotland Stamp Duty Calculator 2024 - A Guide for Scottish Property Investors

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    What Is Stamp Duty Tax in Scotland?

    For beginner buy-to-let investors and even those who have been in the game for a while, navigating the vast array of property-related terms can be overwhelming. You’ve got taxes, additional charges and the various types of real estate that can be purchased and rented out. But there’s one term that seems to cause more confusion than most – Stamp Duty!

    For most people, stamp duty tax is an unavoidable charge on purchasing a UK property investment. However, the confusion surrounding it stems from the fact that it is referred to differently in England, Northern Ireland, Scotland and Wales.

    There are also different stamp duty tax rates in these countries, which are subject to change depending on the value of the property, when it was purchased and whether or not you’re a first-time buyer.

    This blog will focus more specifically on stamp duty tax in Scotland – referred to as Land and Buildings Transactions Tax – but it will also touch on the different rates and regulations across the UK to give you a rounded understanding of this essential property-related term.

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      Stamp Duty Tax - A Closer Look

      On top of the myriad of terms and charges related to property, many investors and even individuals purchasing a new residence for personal use may find themselves pondering the question – what exactly is stamp duty on property?

      In a basic sense, the stamp duty tax is simple. If we strip it back, this is a tax that has to be paid when you buy a residential property or land in England or Northern Ireland.

      This term differs slightly in Scotland and Wales, but the tax remains the same in principle.

      In Wales, this tax is referred to as Land Transaction Tax; similarly, in Scotland, it’s known as Land and Buildings Transaction Tax, which will be the primary focus of this blog.

      We’ll also touch on the various stamp duty rates elsewhere in the UK if you’re interested in purchasing a property in England, Northern Ireland or Wales.

      Primarily, though, this blog will take you through all you need to know about Scotland’s Land and Buildings Transaction Tax, showing you how to calculate what you may be liable to pay based on the value of your property and whether or not you’re a first-time buyer.

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      Stamp Duty in Scotland - Land and Buildings Transaction Tax

      As mentioned, in Scotland, one of the essential charges that influence the cost of purchasing a residential property is the Land and Buildings Transaction Tax. While it is most commonly recognised as the tax associated with residential property purchases, Land and Buildings Transaction Tax extends to non-residential acquisitions and leases, making it a comprehensive fiscal framework.

      For this blog, however, we’ll keep focused on what this tax means for those purchasing a residential property in Scotland, either as a first-time buyer or those intending to make it an additional residence or rental property.

      Land and Buildings Transaction Tax stands as the Scottish counterpart to Stamp Duty Land Tax (STLD), highlighting the autonomy of the Scottish government to make its own decisions regarding property-related taxes and other fiscal policies.

      Any notable changes to Land and Buildings Transaction Tax will be made exclusively by the Scottish government and, therefore, announced in their annual fiscal budget. Revenue Scotland administers and collects the tax, so if you have any queries or concerns regarding this tax, you should refer to their official website.

      With this in mind, it’s important to note that any announcements by the UK government concerning Stamp Duty Tax do not apply in Scotland. This is often a source of confusion for those purchasing a property in the UK and wondering how much they owe when paying stamp duty.

      Put simply, then, if you’re purchasing a property in Scotland, it is Land and Buildings Transaction Tax that applies to you and not Stamp Duty Tax.

      Further Reading: Discover the latest buy-to-let costs and unravel the best UK buy-to-let areas in 2024 with our updated market insights!

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      How Much Do You Pay?

      Land and Buildings Transaction Tax Rates 2024

      The easiest way to work out what you owe is to use the Land and Buildings Transaction Tax calculator on the official Revenue Scotland website or the simple calculator tool we’ve included on this page.

      Depending on the valuation of your property and whether or not you’re a first-time buyer, this useful tool will show you exactly what you’re liable to pay.

      Try Our FREE Stamp Duty Calculator

      Work out your potential stamp duty tax payments with the help of our handy tool.

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      Understanding Rates & Exemptions

      As mentioned above, how much tax you pay depends mainly on the value of the property you purchase and its intended purpose. For instance, the Land and Buildings Transaction Tax you owe will differ if you’re buying a property to live in, intend to rent it out, or want to use it for commercial purposes.

      In short, the amount you need to pay depends on a few key factors:

      • When you bought the property
      • How much you paid for it
      • Its intended use

      Having changed in April 2021, the current Land and Building Transaction Tax rates are set to remain in place at least until after 2026, along with the present guidelines on first-time buyer relief.

      So, if you plan to purchase a property in Scotland any time in the next two years, the following tax bands will apply to you.

      For those purchasing a primary residence in Scotland, you are not required to pay any Land and Buildings Transaction Tax if that property is worth less than £145,000. From this price up to £250,000, you must pay a 2% tax on the property’s value. After that, as property values rise from £250,000 to over £750,000, the tax rates increase to 5%, 10% and 12% respectively.

      Take a look at the table below, which shows the Land and Buildings Transaction Tax Rates and bands for residential properties as of April 2021:

      Purchase Price LBTT Rate 
      Up to £145,0000%
      £145,001 to £250,0002%
      £250,001 to £325,0005%
      £325,001 to £750,00010%
      Over £750,00012% 

      Again, to determine precisely how much you are required to pay, you can use the Land and Buildings Transaction Tax calculator on this page or visit the Revenue Scotland website. However, this table is also a valuable point of reference.

      Read More: Found the perfect investment property? Use our 2024 rental income calculator to calculate your potential returns!

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        First-Time Buyer Relief in Scotland

        There are supports available for first-time buyers concerning Land and Buildings Transaction Tax. This is known as first-time buyer relief and is only available to those buying a property for the first time to use it as their primary residence.

        The Scottish government introduced this tax relief in June 2018. Since then, those purchasing a residential property for the first time have not been required to pay any Land and Buildings Transaction Tax on properties worth less than £175,000.

        In most cases, this won’t be relevant to buy to let investors, as most of them will already have a primary residence, but it’s still helpful to be aware of.

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        What Do I Pay as a Buy-to-Let Investor?

        So then, how does this affect buy-to-let investors purchasing a Scottish rental property?

        Much like in England, Wales and Northern Ireland, if you’re purchasing a property in Scotland for buy-to-let purposes, it’s essential to understand that you’ll likely be paying a higher Land and Buildings Transaction Tax rate.

        The additional dwelling tax rate will apply if the property is worth more than £40,000. If it isn’t, you’re off the hook. But as the average UK property price now stands at over £292,000, it’s unlikely that you’ll find a buy-to-let property as cheap as this.

        For additional properties in Scotland worth up to £145,000, owners must pay 6% on the purchase price. Following this, the subsequent tax rates are 8% on properties worth £145,001 to £250,000, 11% on those priced between £250,001 and £325,000, 16% for those between £325,001 and £750,000, and finally, 18% for anything over £750,000.

        We’ve included the following table to refer to any time you’re wondering how much stamp duty you must pay on a Scottish property if it’s an additional dwelling or a buy-to-let purchase.

        Purchase Price Additional Dwelling Rate 
        Less than £145k6%
        £145k to £250k8%
        £250k to £325k 11%
        £325 to £750k16%
        Rest over £750k 18%

        However, it’s important to remember that these rates will change. To ensure you’re current on the latest Land and Buildings Transaction Tax rates, we recommend referring to the official Scottish government website, which will be updated accordingly.

        Learn More: Want to know the best property to invest in or how to get into UK real estate? Whether buying property as a company or going solo, our expansive beginner investment guides offer everything you need to know before starting!

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        How Do I Pay & When Do I Pay it?

        So, you’ve worked out exactly how much tax you owe based on the value of the property you’re purchasing and the purpose for which you’re buying it. Now you need to know when you’re supposed to pay and where exactly to send the money.

        After you buy the property, your Land and Buildings Transaction Tax payment must be paid within 30 days of the initial purchase.

        The buyer of a property is required to calculate and pay any Land and Buildings Transaction Tax due at the same time they submit their tax return to Revenue Scotland.

        Suppose the Additional Dwelling Supplement is applicable (say you are purchasing a property for buy-to-let purposes). In that case, you must include this in the original tax return and pay the Additional Dwelling Supplement and any other payment due. We have also published some useful factual data regarding student accommodation investment for our readers to peruse.

        It is possible to complete this process online through the official Revenue Scotland website. Here, you will find helpful information on every step of the process, including advice on filling out the relevant tax return and completing the payment process.

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          How LBTT Contributes to the Economy

          Taxes such as the Land and Buildings Transaction Tax make up a significant portion of the Scottish budget and, as such, are essential for the funding of public services.

          A relatively recent development, the Land and Buildings Transaction Tax, was brought in to replace Scotland’s UK Stamp Duty Tax in 2015. Since then, this tax has contributed to funding essential services such as healthcare, schools and housing.

          According to Revenue Scotland, a total of £82.6m worth of Land and Buildings Transaction Tax was declared by taxpayers in December 2023, highlighting the steady contribution it makes to the Scottish economy.

          In the same month, 9,580 notifiable land and building transactions were reported. Additionally, 8,070 residential Land and Buildings Transaction Tax returns were submitted in December last year. Why not learn more about how to get into real estate investment with our property guides.

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          UK Stamp Duty Taxes

          Stamp Duty Tax – England & Northern Ireland

          In England and Northern Ireland, buyers are not required to pay stamp duty on properties worth up to £250,000. After this, the rates payable rise to 5%, 10%, and 12% for properties priced from £250,001 to over £1,500,000.

          For first-time buyers, stamp duty tax is not needed unless a property is worth over £425,000, which will be in the 5% bracket.

          For buy-to-let investors or anyone purchasing an additional property, a higher stamp duty tax rate will need to be followed. This starts at 3% for properties worth up to £250,000 and rises to 8%, 13% and 15%, respectively, as property values move through the existing bands.

          Frequently Asked Questions

          Those purchasing a property as their primary residence for the first time are not required to pay Land and Buildings Transaction Tax if the property is worth less than £175,000.

          Payments for Land and Buildings Transaction Tax can be made online via the Revenue Scotland website.

          Yes, Land and Buildings Transaction Tax is still a requirement for overseas investors. For those purchasing an additional property or making a buy-to-let investment, the rates for additional dwellings will apply.

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            We hope you’ve found our guide on Scottish Land and Buildings Transaction Tax informative and have been able to use our calculator tool to work out how much you owe.

            If you have any further questions about investing in property in the UK or how UK stamp duty rates may apply to you or our investment properties or, more specifically, Land and Building Transaction Tax in Scotland, it’s worth seeking the help and advice of a financial adviser who can offer you detailed and informed advice.

            Alternatively, if you want to learn more about UK property investment, then be sure to check out our free in-depth guides!

            Here, you can learn about the UK’s top investment areas in detail, which can help you decide which area and type of property may be best for you, including: 

            You can also learn more about the different stamp duty taxes across the UK in our free UK Stamp Duty Calculator. Or, if you’d like to know more about property investment in general, check out our updated guide to learn how to build a property portfolio in 2024!

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            Author

            Patrick Faulkner

            Patrick is a property content writer at RWinvest. Keeping a close eye on the UK property market, Patrick helps our readers stay informed and up to date on the latest market news and statistics.

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