Whether you have a property portfolio or are looking to take your first fledgling step into the buy-to-let arena, it’s vital to keep up-to-date on changes to legislation and how they could affect you – especially ones that could hit you in the pocket. With that in mind, let’s take a look at the recent changes to the Land and Buildings Transaction Tax.
What does it mean for me?
Essentially the Scottish equivalent of Stamp Duty, LBTT is calculated according to the specific price bracket that the property you’re buying falls into. Previously, any house under £145,000 was exempt from the tax, with the rate scaling all the way to 12% for properties valued over £750,000.
As always with these things, it’s not quite so simple for landlords. From April 1st, an amendment was applied to the LBTT that added a 3% levy on to the purchase of any buy-to-let property. While that might not sound like much on paper, the LBTT effectively bumps up the cost of the average £165,000 house by almost £5,000, with only properties under £40,00 remaining exempt.
To give some idea of how big a change this is to the market, according to the Scottish Fiscal Commission, the official watchdog of the Scottish government’s tax and spending plans, the supplement on LBTT could raise between £19m and £27m a year.
“The buy-to-let market is growing ever more complicated and it’s vital that you keep up-to-date with its rules and regulations. That’s where we come in. Drawing on more than half a century-worth of experience in the market, we can provide expert advice on everything from the implications of the new Private Residential Tenancy Legislation to how to maximise the return on your investment.
“If that sounds right up your street, give me a call or pop in to the office for a chat. Whether you’re the owner of one property or one hundred, we’ll help you make the most of your investment.”
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