Scottish Budget 2023/2024 – LBTT and ADS
Land and Buildings Transaction Tax (LBTT) and Additional Dwelling Supplement (ADS)
LBTT is a tax applied to residential and non‑residential land and buildings transactions (including commercial leases) where a chargeable interest is acquired. The Additional Dwelling Supplement (ADS) is payable, as part of LBTT, on purchases of all relevant residential properties for £40,000 and above.
- LBTT residential rates and bands are to be maintained at their current levels
- The First‑Time Buyer Relief will also continue to be available. This has the effect of increasing the nil rate band from £145,000 to £175,000 for first‑time buyers.
- The ADS will increase from 4% to 6%, with effect from 16 December 2022
The increased rate will not apply if the contract for a transaction was entered into on or before 15 December 2022.
Rates and Bands
Rates and bands in 2023-24 will be as follows:
| LBTT Rates and Bands for Residential Conveyances* | |
| Relevant Consideration | Rate |
| Up to £145,000 | 0% |
| Above £145,000 to £250,000 | 2% |
| Above £250,000 to £325,000 | 5% |
| Above £325,000 to £750,000 | 10% |
| Over £750,000 | 12% |
*If the first-time buyer relief applies, the effect is to increase the nil rate band to £175,000.
| LBTT Rates and Bands for Non-Residential Conveyances | |
| Relevant Consideration | Rate |
| Up to £150,000 | 0% |
| Above £150,000 to £250,000 | 1% |
| Above £250,000 | 5% |
| LBTT Rates and Bands for Non-Residential Leases* | |
| Net present value of rent payable | Rate |
| Up to £150,000 | 0% |
| Above £150,000 to £2m | 1% |
| Above £2m | 2% |
*LBTT on lease premiums is payable at the same rates and bands as non-residential conveyances.
In addition, the ADS may apply to the total price of the property for all relevant transactions of £40,000 or more and will be charged in addition to the rates set out above. As noted above this will apply at a rate of 6% for transactions with an effective date from 16 December 2022, unless the transitional provisions apply.
Scottish Budget 2023/2024 – Scottish Income Tax Rates
Scottish Budget 2023/2024 – Non-Domestic Rates
Photo by Scott Webb on Unsplash
The information in this blog provides only an overview of Scottish Government guidance and legislation in force at the date of publication and no action should be taken without consulting the detailed Scottish Government guidance and legislation or seeking professional advice. Therefore no responsibility for loss occasioned by any person acting or refraining from action as a result of the material contained in this blog can be accepted by the firm.
