The Scottish government announced in its budget on 12 December 2018 that it plans to increase the current 3% rate of Additional Dwelling Supplement (ADS) to 4% from 25 January 2019. If approved by the Scottish Parliament, the increase will apply to contracts entered into on or after 12 December 2018.
ADS was introduced in 2016 for people buying an additional residential property over and above their main home. This tax will be increased to 4% of the total purchase price of an additional residential property purchase of £40,000 or more. Information about how ADS applies to your property purchase can be found here.
ADS is part of the Scottish government’s stated drive to help first-time buyers onto the housing market. However, MOV8 Real Estate’s Managing Director, Robert Carroll, states:
“I remain of the view that the tax is counterproductive and does not achieve the laudable aims of helping people to get onto, and climb, the property ladder. The tax does not seem to target the right people and is likely to cause structural problems in the housing market in Scotland because of the way that it restricts people’s ability to move home.”
For more information about why we believe ADS is counterproductive to the housing market in Scotland, see our Guide to LBTT Additional Dwelling Supplement (ADS).
If you have any questions about ADS or how it might apply to the circumstances of your purchase, please don’t hesitate to get in touch with our Conveyancing Team by calling 0131 297 7999 or by emailing [email protected] and we will be happy to help.