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Possible Partial Property Tax Relief for First Time Purchasers!

Possible Partial Property Tax Relief for First Time Purchasers!

The Scottish Government opened a consultation on 9th February 2018, and welcomed responses from companies and individuals alike on whether the introduction of a new relief in respect to Land and Buildings Transaction Tax (formerly known as Stamp Duty/SDLT) would be met with positive reactions. The introduction of this relief would mean that first time buyers could benefit from a smaller tax bill, when purchasing their first home, if they meet certain criteria.

The consultation was closed on 9th February 2018. The Scottish Government advise that, following consideration of the consultation responses, an amended statutory order is to be presented to the Scottish Parliament for approval – the Land and Buildings Transaction Tax (First-Time Buyer Relief) (Scotland) Order 2018.

The Scottish Government have advised that it is likely that, generally, in order to claim the relief (i) the purchaser would need to be a natural person i.e. not a corporate body, (ii) the purchaser would need to be a first time buyer who has never had a “major interest” in a dwelling located anywhere in the world, (iii) the purchaser would need to intend to occupy the dwelling as their main and principle residence and (iv) the purchase price of the dwelling would need to be more than £145,000.00 (there being no LBTT on a residential purchase below that sum anyway). It is not proposed that the Relief will be a complete exemption but would shave a maximum of £600.00 of a first time buyer’s tax bill, depending on the purchase price, and if they can meet the statutory requirements which will be laid out in the order, once published.

If the order is passed by Scottish Parliament, we understand that the relief will take effect from 30th June 2018, provided that the contract for the purchase was concluded after 9th February 2018 and the transaction meets the statutory requirements. We would recommend that you check our website for future updates as, if the relief is introduced, it could offer a welcomed saving to first time buyers.

For more information, contact a member of our Conveyancing Team on 01631 562308 or 01397 701000