Will the proposed LBTT make England more attractive than Scotland as a place to buy property?
John Coleman of Smiths Gore in Edinburgh (0131–344 0880) is urging the SNP to rethink its proposed Land and Buildings Transaction Tax (LBTT), which, he maintains, will make England more attractive than Scotland as a place in which to buy property. The introduction of the new Stamp Duty regime throughout the rest of the UK (Property Market, January 7) has highlighted huge differences between the two systems, making the tax payable in Scotland up to double that payable in England.
Buyers and vendors both need to act swiftly in order to avoid paying the new LBTT rates, which come into force on April 1 for any property sales not completed by that date. Consequently, Smiths Gore have advanced the sale of idyllic Loch Eye House (above) and Loch Eye Cottage at Fearn, Ross-shire, on the shores of Loch Eye, 33 miles north of Inverness, quoting a guide price of £650,000 for the main five-bedroom house and £250,000 for the two-bedroom cottage. A buyer completing the purchase of both houses as one £900,000 transaction before April 1 would be liable for £35,000 in tax—the same as in England. After April 1, however, the new LBTT rate payable in Scotland will be £67,300—an increased liability of £32,300. ‘The Scottish government needs to make Scotland more attractive to inward investors, not less so,’ Mr Coleman suggests.