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The Land and Buildings Transaction Tax (Miscellaneous Amendments) (Scotland) Order 2024

Draft. This instrument was laid in draft and may differ from the one made. Look for the made version under its title.

Draft 2024, ISBN 9780111058992

Original text. legislation.gov.uk does not revise statutory instruments, so later amendments are not shown here. Changes made to it are listed under each provision when known.

Draft Order laid before the Scottish Parliament under section 68(2) of the Land and Buildings Transaction Tax (Scotland) Act 2013, for approval by resolution of the Scottish Parliament.

Land And Buildings Transaction Tax

Made 2024

Coming into force 1st April 2024

The Scottish Ministers make the following Order in exercise of the powers conferred by section 27(3) and paragraph 19(3) of schedule 2A of the Land and Buildings Transaction Tax (Scotland) Act 2013f1 and all other powers enabling them to do so.

In accordance with section 68(2)f2 of that Act, a draft of this instrument has been laid before, and approved by resolution of, the Scottish Parliament.

Annotations to the whole text

Footnotes

f1

2013 asp 11. Schedule 2A was inserted by section 1(3) of the Land and Buildings Transaction Tax (Amendment) (Scotland) Act 2016 (asp 11) (“the 2016 Act”). There are amendments to paragraph 19 that are not relevant to this instrument.

f2

Section 68 was relevantly amended by section 2(1)(c)(i) of the 2016 Act.

Contents

  1. 1Citation and commencement
  2. 2Relief for certain acquisitions by local authorities
  3. 3Relief for certain acquisitions by local authorities
  4. 4Amendment of schedule 2A
  5. 5Amendment of schedule 2A
  6. 6Amendment of schedule 2A
  7. 7Amendment of schedule 2A
  8. 8Amendment of schedule 2A
  9. 9Amendment of schedule 2A
  10. Signature
  11. Schedule Schedule
  12. Explanatory note

1Citation and commencement

This Order may be cited as the Land and Buildings Transaction Tax (Miscellaneous Amendments) (Scotland) Order 2024 and comes into force on 1 April 2024.

2Relief for certain acquisitions by local authorities

In section 27(1) of the Land and Buildings Transaction Tax (Scotland) Act 2013 (reliefs) after “schedule 6 (relief for certain acquisitions by registered social landlords),” insert—

“schedule 6A (relief for certain acquisitions by local authorities),”.

3Relief for certain acquisitions by local authorities

After schedule 6 of the Land and Buildings Transaction Tax (Scotland) Act 2013, insert schedule 6A contained in the schedule of this Order.

4Amendment of schedule 2A

Schedule 2A of the Land and Buildings Transaction Tax (Scotland) Act 2013 (additional amount: transactions relating to second homes etc.)f1 is amended in accordance with articles 5 to 9.

5Amendment of schedule 2A

In paragraph 2(2)—

(a)

in head (a), for “18” substitute “36”,

(b)

in head (b), for “18” substitute “36”.

6Amendment of schedule 2A

In paragraph 6—

(a)

after sub-paragraph (1), insert—

“(1A)

For the purposes of paragraph 8(1), a dwelling which is disposed of by—

(a)

the buyer’s spouse or civil partner,

(b)

the buyer’s cohabitant,

(c)

a person aged under 16 who is a child of—

(i)

the buyer,

(ii)

the buyer’s spouse or civil partner, or

(iii)

the buyer’s cohabitant,

is to be treated as being disposed of by the buyer.”,

(b)

in sub-paragraph (2), for “and (1)(c)(ii)” substitute “, (1)(c)(ii), (1A)(a) and (1A)(c)(ii)”,

(c)

in sub-paragraph (4), for “and (1)(c)(iii)” substitute “, (1)(c)(iii), (1A)(b) and (1A)(c)(iii)”.

7Amendment of schedule 2A

(1)

Paragraph 8(1) is amended in accordance with paragraphs (2) to (5).

(2)

In head (a)—

(a)

for “18” substitute “36”,

(b)

for “the day after” substitute “or ending with”,

(c)

after “buyer” insert “or, where there are two or more buyers who are or will be jointly entitled to the interest acquired, one of the buyers”.

(3)

In head (b)—

(a)

after “buyer’s” insert “or, where there are two or more buyers who are or will be jointly entitled to the interest acquired, one of the buyers’”,

(b)

for “18” substitute “36”,

(c)

omit “and”.

(4)

In head (c), for “buyer’s only or main residence.” substitute “buyer’s or, where there are two or more buyers who are or will be jointly entitled to the interest acquired, all of the buyers’ only or main residence, and”.

(5)

After head (c) insert—

“(d)

where there are two or more buyers who are or will be jointly entitled to the interest acquired, each of whom own a dwelling or dwellings other than the subject-matter of the transaction, all of the buyers must meet the conditions specified in this sub-paragraph.”.

8Amendment of schedule 2A

After paragraph 9Af1 insert—

“Relief for beneficiaries

9B.
(1)

A chargeable transaction to which this schedule applies by virtue of paragraph 2 is exempt from the additional amount if—

(a)

at the end of the day that is the effective date of the transaction, the buyer or, where there are two or more buyers who are or will be jointly entitled to the interest acquired, one of the buyers owns two or more dwellings,

(b)

the date of acquisition of ownership of all but the last of those dwellings is after the date on which the buyer entered into the contract for the land transaction relating to the last of those dwellings, but before the effective date, and

(c)

the buyer—

(i)

is a beneficiary of the estate of a deceased person and acquired ownership of all but the last of those dwellings by virtue of a conveyance or transfer in their favour by the executors of that person, or

(ii)

otherwise acquires ownership of all but the last of those dwellings as a result of the death of a person.

(2)

For the purposes of paragraph (1) the date on which the buyer acquired ownership of a dwelling by virtue of a conveyance or transfer in their favour by the executor of a deceased person is the date on which the conveyance or transfer was delivered by the executor to the buyer.

Relief for separated spouses and civil partners retaining interest in former main residence

9C.

A chargeable transaction to which this schedule applies by virtue of paragraph 2 is exempt from the additional amount if—

(a)

at the end of the day that is the effective date of the transaction, the buyer is the owner of two dwellings,

(b)

the first of the two dwellings was at any time before the effective date of the transaction the only or main residence of the buyer and the buyer’s spouse, civil partner, former spouse or former civil partner,

(c)

the first of the two dwellings is the only or main residence of the buyer’s spouse, civil partner, former spouse or former civil partner,

(d)

the buyer and the buyer’s spouse, civil partner, former spouse or former civil partner do not intend to live together again, and

(e)

the buyer retains an ownership interest in the first of the two dwellings in pursuance of an order of a court or agreement of a type referred to in paragraph 4 or 5 of schedule 1.”.

9Amendment of schedule 2A

In paragraph 17(2) after “dwelling” insert “, but if the market value of the share in the ownership interest of the dwelling of any of the persons is less than £40,000, that share is not to be counted for the purposes of determining whether this schedule applies to a transaction under paragraph 2 of this schedule”.

Signature

Name

Authorised to sign by the Scottish Ministers

St Andrew’s House,

Edinburgh

Date

“SCHEDULE 6A

RELIEF FOR CERTAIN ACQUISITIONS BY LOCAL AUTHORITIES

(introduced by section 27)

The relief

1.

A land transaction under which the buyer is a local authority is exempt from charge if either of the qualifying conditions are met.

The qualifying conditions

2.

The qualifying conditions are—

(a)

that the transaction is entered into in pursuance of powers conferred by section 2 of the Housing (Scotland) Act 1987f1 (powers of local authority to provide housing accommodation), or

(b)

that the transaction is funded with the assistance of a grant or other financial assistance under section 2 of the Housing (Scotland) Act 1988f2 (general functions of Scottish Homes).”

Explanatory note

(This note is not part of the Order)

This Order makes various amendments to the Land and Buildings Transaction Tax (Scotland) Act 2013 (“the Act”).

Articles 2 and 3 establish a new targeted relief, in a new schedule 6A of the Act. The targeted relief is to provide relief from land and buildings transaction tax where the buyer is a local authority and the acquisition of land is funded by the Scottish Ministers under section 2 of the Housing (Scotland) Act 1987 or section 2 of the Housing (Scotland) Act 1988.

Article 5 modifies paragraph 2(2) of schedule 2A of the Act so that the period ending with the effective date of a transaction, during which the replacement of an only or main residence gives rise to relief from payment of the additional amount, is extended to 36 months.

Article 6 modifies paragraph 6 of schedule 2A of the Act so that properties owned by the buyer’s spouse, civil partner, cohabitant, or a child of the buyer or any of those persons, which are currently deemed to be owned by the buyer, are also deemed to be disposed of by the buyer, when disposed of.

Article 7 modifies paragraph 8 of schedule 2A of the Act so that relief from the additional amount is extended to transactions by joint buyers where either of the joint buyers disposes of their own former main residence in the relevant period before the effective date of the transaction, or where only one of the joint buyers has an ownership interest in a former main residence which can be disposed of in the relevant period. Further, it extends the relevant period to 36 months before or after the effective date of the transaction.

Article 8 inserts a new paragraph 9B and 9C into schedule 2A of the Act. Paragraph 8B adds a relief from the additional amount where a buyer is replacing their main residence but inherits an ownership interest in a second dwelling in the period after missives have been concluded for the purchase of the new main residence.

Paragraph 9C adds a relief from the additional amount where a buyer is replacing their main residence but is subject to a court order requiring them to retain an ownership interest in a second dwelling which is a former main residence, following divorce, dissolution of a civil partnership or judicial separation.

Article 9 amends paragraph 17 of schedule 2A of the Act to provide that a share worth less than £40,000 in a jointly owned property is to be disregarded for the purposes of determining whether schedule 2A applies to a transaction.