Scottish property taxes top £623m

Scottish property taxes top £623m

0:02 AM, 22nd May 2024, About 6 months ago 2

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Property taxes in Scotland surpassed £623 million over the past year – a slight increase of £3 million over the previous year, one lettings agency says.

The analysis by DJ Alexander reveals that the Land and Buildings Transaction Tax (LBTT) generated the bulk of this revenue.

The Additional Dwelling Supplement (ADS), which is a tax on second homes and buy to let properties, saw a substantial rise of £37.9 million to £194.5 million.

The firm says this suggests a rise in buy to let investments despite the additional tax burden.

‘The Scottish homebuyer has paid handsomely’

The firm’s chief executive, David Alexander, said: “Once again, the Scottish homebuyer has paid handsomely for the privilege of buying a house in Scotland rather than south of the Border.

“With the 10% property tax beginning at £325,001 in Scotland, compared to £925,001 in England, we are charged substantially more than our English counterparts.”

He adds: “But this does not appear to be hampering the market in Scotland which remains as resilient and as buoyant as ever.

“The long-term outlook may not be so rosy but in the short term the Scottish property market remains the strongest in the UK increasing 4.4% between March 2023 and February 2024.”

‘Landlords buying into the private rental sector’

Mr Alexander continued: “Perhaps even more extraordinary is the high level of additional dwelling supplement (ADS) being paid indicating the resilience of investors and landlords buying into the private rental sector.

“While this 6% additional tax is also charged on second homes, the number of those has been plummeting in recent years, so property investment is the most likely source of these purchases.”

He adds: “The truth is that LBTT, like Stamp Duty Land Tax (SDLT) in England, is an easy earner for governments.

“Buying a house is a visible transaction, so buyers simply have to pay up or move to somewhere where the purchase costs are not quite as punitive.”


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Beaver

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12:45 PM, 22nd May 2024, About 6 months ago

“Buying a house is a visible transaction, so buyers simply have to pay up or move to somewhere where the purchase costs are not quite as punitive.”

That's correct. And a lot of the rich people are already selling up and moving.

Cider Drinker

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15:46 PM, 22nd May 2024, About 6 months ago

Why does the firm say ‘this suggests a rise in buy to let investments despite the additional tax burden?’

Why can the rise not suggest that many people are buying second homes for their personal use or for use a FHLs?

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