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Land and Buildings Transaction Tax - Additional Dwelling Supplement: call for evidence and views

We are seeking evidence and views on the operation of the Land and Buildings Transaction Tax (LBTT) Additional Dwelling Supplement (ADS). This will be the first stage in the review of the ADS announced in the 2021 to 2022 Programme for Government.


7. Summary of Questions

Timelines for the ADS

A1: Time taken to purchase a new main residence: 18 month window

1. Should the Scottish Government considering amending the length of time available to purchase a new main residence following the sale of a previous main residence from 18 months?

2. If so, can you provide further explanation and/or evidence regarding the circumstances in which 18 months may not be appropriate?

3. If the Scottish Government were to amend the length of time available to purchase a new main residence, what period of time should be considered and why?

A2: Disposal of a previous main residence: 18 month window

4. Should the Scottish Government consider amending the length of time in which a previous main residence can be sold in order for a repayment of the ADS to be claimed?

5. If so, can you provide further explanation and/or evidence where 18 months may not be appropriate?

6. If the Scottish Government were to amend the length of time available to dispose of the ownership of a main residence, what period of periods of time should be considered and why?

B: Specific Scenarios

B1. Inherited Property

7. What circumstances and issues should the Scottish Government take into account in considering the treatment of low value interests in inherited properties for the purposes of LBTT?

8. Should the Scottish Government consider the introduction of a grace period along the lines of that in place for SDLT in respect of inherited property? If so, what arrangements should be considered?

B2: Divorce or Separation

9. What circumstances and issues should the Scottish Government take into account in considering the tax treatment of a new property purchased following a divorce or separation, and why?

10. Do you have views on the case for a more specific legislative amendment along the lines of that available in SDLT? If so, please provide further details.

11. Separately, would increasing the length of time available to dispose of a main residence (see A2) assist in situations of divorce or separation?

B3. Joint Buyers/Economic Unit Provisions

12. Are there other issues of concern regarding the treatment of joint buyers which the Scottish Government should consider? If so, can you provide further explanation and evidence regarding these?

13. Do you have any proposals as to how the legislation might be amended in response to these scenarios, in a way that would ensure consistency with the application of the ADS for an individual buyer?

C: Transactions Involving Housing Providers

C1. Transactions involving Local Authorities – Affordable Housing

14. What circumstances and issues should the Scottish Government consider in assessing the case for a broader relief for local authorities where properties are acquired for affordable housing purposes, and why?

C2. Housing Co-operatives and other approaches

15. Are there grounds for the Scottish Government to consider the introduction of a relief from the ADS for housing co-operatives, or any other approaches intended to deliver housing which is affordable? Please provide further explanation and evidence regarding this.

D. Exceptional Circumstances

16. Is there a case for the Scottish Government to consider legislating for an exceptional circumstances provision along the lines discussed above?

17. If so, what circumstances should be considered, and on what grounds?

Additional Questions

18. Is there any other issue regarding the operation of the ADS legislation which you would wish the Scottish Government to consider as part of the overall review? If so, please provide explanation and commentary on any available evidence about this.

19. Are there any other points you would wish to raise regarding the operation of the ADS in different parts of Scotland?

20. The Scottish Government has a duty:

  • to eliminate discrimination, advance equality of opportunity and foster good relations between different people; and
  • to have regard to the impact on island communities in carrying out its functions.

Are there any issues relevant to the content of this consultation that you believe the Scottish Government should consider in order to assure performance of these duties?

Contact

Email: Devolvedtaxes@gov.scot

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