Scotland’s new tax is on track to iron out some of the inequalities in the property market

In April 2015, for the first time in more than 300 years, Scotland will be levying its own property tax, and it is quite fitting that this home-grown imposition should resolve some of the iniquities of the UK tax which it is being designed to replace.

The Land and Buildings Transaction Tax, which is being introduced as part of the Scotland Act 2012, will replace the UK-wide Stamp Duty Land Tax, a system which has undeniably had an impact in specific areas of the property market.

The issue with stamp duty is that currently it is levied at particular thresholds: 0% up to £125,000, 1% up to £250,000, 3% up to £500,000, 4% up to £1 million, 5% up to £2 million and 7% above that.

This means that if someone buys a house at £125,000 there is no stamp duty to pay but, if the purchase price is £125,001, there would be a stamp duty charge of £1250.01 to add to the purchase costs.

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2018-12-18T10:49:03+00:00