Stamp Duty Land Tax (SDLT) equivalents in Wales and Scotland

Welsh “SDLT”: Land Transaction Tax (LTT)

Land Transaction Tax (LTT), which comes into effect on 1 April 2018 in Wales, replaces Stamp Duty Land Tax (SDLT), which is currently applied in England, Northern Ireland and Wales.  

Under the new system, the starting threshold for paying property tax will be £150,000 – compared with £125,000 at present.

The UK House Price Index for July 2017, the average price of a property in Wales was £150,846 – just above the new property tax limit.

Under the new rules, announced as part of the Welsh government budget for 2018-19, all buyers of residential properties costing up to £400,000 will pay the same or less tax than they do now, with the average buyer paying almost £500 less tax than they do under current SDLT (stamp duty land tax).

However, buyers looking for homes on the upper band rates between £400,000 and £925,000 will pay more than at present. For example, a buyer purchasing a property in Wales for £400,000 would currently pay 5% stamp duty, but this will rise to 7.5% under the new rules.

The additional “surcharge” tax for buying a second property either as a Holiday Home or an Investment will remain the same – at 3% on top of each band. This also applies to Companies or Trusts purchasing property.

New land transaction tax rates in Wales from April 2018:

Price threshold                              Main residential rates

£0 – £150,000                                  0%

£150,001 – £250,000                      2.5%

£250,001 – £400,000                      5%

£400,001 – £750,000                      7.5%

£750,001 – £1.5 million                    10%

Above £1.5 million                           12%

Note: In both cases, it is a tapered system so, for example, if you currently buy a house for £275,000, the stamp duty you will owe is: 0% on the first £125,000, 2% on the next £125,000 and 5% on the next £25,000, totaling £3,750. Further guidance on LTT, including the rules and reliefs that may be available, is available on the Welsh Revenue Authority’s website.

Scottish “SDLT”: Land and Buildings Transaction Tax (LBTT)

Rates & Allowances 2017/2018:

On the transfer of property in Scotland, the Land and Buildings Transaction Tax is:

Value up to £145,0000%
Over £145,000 – £250,0002%
Over £250,000 – £325,0005%
Over £325,000 – £750,00010%
Over £750,00012%
Value up to £150,0000%
Over £150,000 – £350,0003%
Over £350,0004.5%

Again, the rates apply to the portion of the total value which falls within each band.

Additional LBTT of 3% applies to the purchase of additional residential properties or any property purchased by a Company or a Trust, as with all other UK jurisdictions.

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