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:
|Up to £145,000
|£145,001 to £250,000
|£250,001 to £325,000
|£325,001 to £750,000
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.
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