Stamp Duty is a tax paid on property purchases, but it’s handled differently in Scotland, Northern Ireland, and Wales. Here’s an overview of how it works in each region:
1. Scotland: Land and Buildings Transaction Tax (LBTT)
- Overview: In Scotland, Stamp Duty has been replaced by the Land and Buildings Transaction Tax (LBTT).
- Rates: LBTT rates are tiered, meaning you only pay the percentage on the portion of the property price that falls within each band.
- Up to £145,000: 0%
- £145,001 to £250,000: 2%
- £250,001 to £325,000: 5%
- £325,001 to £750,000: 10%
- Above £750,000: 12%
- First-Time Buyers: First-time buyers get relief, increasing the 0% threshold to £175,000.
- Additional Dwelling Supplement (ADS): If you’re buying an additional property (like a buy-to-let or second home), an additional 6% is charged on top of the standard rates.
2. Wales: Land Transaction Tax (LTT)
- Overview: Wales replaced Stamp Duty with the Land Transaction Tax (LTT) in April 2018.
- Rates: Similar to LBTT, LTT is also tiered.
- Up to £225,000: 0%
- £225,001 to £400,000: 6%
- £400,001 to £750,000: 7.5%
- £750,001 to £1.5 million: 10%
- Above £1.5 million: 12%
- First-Time Buyers: There’s no specific relief for first-time buyers, but the higher 0% threshold benefits them.
- Additional Dwelling Supplement: An additional 6% is applied to the purchase of additional properties.
3. Northern Ireland: Stamp Duty Land Tax (SDLT)
- Overview: Northern Ireland still follows the same Stamp Duty Land Tax (SDLT) system as England.
- Rates: SDLT is also tiered.
- Up to £250,000: 0%
- £250,001 to £925,000: 5%
- £925,001 to £1.5 million: 10%
- Above £1.5 million: 12%
- First-Time Buyers: First-time buyers are exempt from SDLT on properties up to £425,000. If the property is worth up to £625,000, they pay 5% on the portion over £425,000.
- Higher Rates for Additional Properties: An additional 3% is charged on top of the standard rates for buying an additional property.
Summary of Key Differences:
- Scotland (LBTT) has a 0% threshold at £145,000 (£175,000 for first-time buyers) and charges 12% for properties above £750,000.
- Wales (LTT) has a higher 0% threshold at £225,000, but has steeper rates, starting at 6% from £225,001 upwards.
- Northern Ireland (SDLT) follows the same system as England, with first-time buyer relief up to £425,000 and the standard SDLT bands.
These differences can significantly impact the cost of purchasing property in each region, so it’s crucial to be aware of the specific rules applicable to the area where you’re buying.