In June 2018 the Scottish Government introduced a first time buyers relief to support purchasers buying their first home. This meant an introduction of a zero- rated LBTT threshold for properties with a purchase price of up to £175,000 for first-time buyers. The introduction of this relief effectively raised the starting threshold for first-time buyers from £145,000 to £175,000. Those purchasing property at a higher value will also have their tax reduced.
Minister Kate Forbes said: “around 80% of first-time buyers will pay no LBTT, helping thousands of people across the country buy their first home.”
That said, on the 15th July 2020 the Scottish Parliament went on to increase the starting threshold for LBTT for all residential property transactions to £250,000 until 31 March 2021. This change in the starting threshold for LBTT is greater than that provided by the first-time buyer relief meaning that the relief currently has no practical effect during the temporary period in which the £250,000 threshold is in place. The temporary freeze on LBTT is due to end on the 31st March 2021 when the first time buyers relief is due to come into place.
For more info on LBTT please have a read of our LBTT blog.
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