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Important changes to Land and Buildings Transaction Tax Rates in 2019

What is being changed?

The Scottish Government is proposing changes to the LBTT regime in Scotland. The non-residential (Commercial) LBTT rate is coming down from 3.5% to 1%, but only for those parts of a purchase price between £150,000 and £250,000. However, a new higher rate of 5% will apply for any parts of a purchase price above £250,000. Previously, the non-residential rate was 3.5% from £150,000 to £350,000 and 4.5% above £350,000.

The proposed non-residential rates can therefore be summarised as follows:-

Purchase Price LBTT Rate
Not more than £150,000 0%
£150,001 to £250,000 1%
Over £250,000 5%


What about residential properties?

The standard rates are staying the same, however the Additional Dwelling Supplement (ADS) for the purchase of “second homes” with a purchase price greater than £40,000, is increasing from 3% to 4% of the total purchase price. That will therefore mean that this already significant additional tax is set to increase even further for purchasers of a second residential dwelling.

When would these changes take effect?

If approved by the Scottish Parliament, the new rates will be effective from 25 January 2019. However, the new rates will not apply to transactions where the effective date is on or after 25 January 2019 if contracts have been entered into prior to 12 December 2018.

If you have any queries regarding the new LBTT rates and would like some further advice on how you are affected, please contact our Associate Director, Craig Smith on 01383 745776 or

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