Call us today on 0141 552 9193
GLP News

News, Comment & Opinions on the latest legal stories

Glasgow Law Practice White

Practice made perfect

New Tax Rates to be Reviewed In Budget

The Scottish Government has confirmed that tax rates, which are set to replace stamp duty when buying a property, are to be reviewed as part of the budget.

The move comes following pressure on the government regarding the Land and Buildings Transaction Tax. The tax is seen as targeting properties at the top end of the market after it raised the threshold for paying tax on a home from £125,000 to £135,000, but increased the amount to 10% on homes above £250,000 and up to £1 million.

Follows UK Overhaul

The decision to review the process comes following George Osborne’s decision to overhaul stamp duty in the UK to a graduated rate which means some purchasers benefit more under the stamp duty system. As a result of this, the Scottish government has opted to review the situation in an attempt to find the best deal for the people of Scotland.

Under the UK stamp duty reforms, buyers pay 2% on the on the part of the property price up to £250,000, 5% on the part between £250,000 and £925,000, and 10% on the proportion between £925,001 and £1.5 million.

Tax Rate For Scotland

The Finance Secretary John Swinney said: “At the time of the UK Chancellor’s Autumn Statement I said his imitation of my Scottish tax plans was the sincerest form of flattery.

“On the first occasion I’ve had to design a tax system for Scotland, the UK Government copied it instantaneously and applied it across the UK.

“At the time of my proposals – designed for the Scottish market, not London house prices – 90% of homebuyers would have been better or no worse off, and 5,000 homes would be taken out of taxation together, helping those at the lower end of the market.

“The Chancellor’s decision to introduce a new stamp duty system, means that while 80% of homeowners continue to pay less tax or no tax at all under the Scottish system we now have the opportunity to review the rates and ensure they are right for Scotland.”

“Scots Being Punished” Under Current Reform

John Boyle, director of research and strategy at Rettie and Co, felt that it was imperative that the Scottish Government listened to feedback. He said: “We argued that the 80% Who would save money through what was proposed would save what amounted to a few hundred pounds, while the 20% who would pay more would be unfairly hit.

“People in Edinburgh, Aberdeen and parts of Glasgow would all have been affected and it would have been a bit punitive on buyers in these areas. Trying to buy a family property in these cities for less than £250,000 is pretty difficult, and very few family homes sell for less than this.”

Contact Us

If you require legal advice regarding property in Glasgow, if you require legal representation in light of the new tax being introduced in Scotland, or for any legal matter regarding property, contact us today using our online contact form.