If you invest in Scottish property, stamp duty does not apply. Scotland has its own tax called Land and Buildings Transaction Tax, or LBTT. The rates and bands are different from England.
For a standard residential purchase in Scotland, the rates are 0% up to £145,000, 2% from £145,001 to £250,000, 5% from £250,001 to £325,000, 10% from £325,001 to £750,000, and 12% above £750,000.
On a £250,000 Scottish property, your LBTT is 0% on the first £145,000 and 2% on the next £105,000, which equals £2,100. In England, the same property would cost £2,500 in SDLT for a main home. The difference is small at this price point.
But Scotland also has an Additional Dwelling Supplement of 6% for second homes and BTL properties, which is higher than England’s 5% surcharge. On a £200,000 Scottish BTL, your LBTT plus supplement is roughly £12,650. In England, the same purchase would cost £11,500. Scotland is slightly more expensive for BTL investors.
If you are considering property in Scotland, use the LBTT calculator on the Revenue Scotland website before you budget. The bands are different enough that your English SDLT knowledge will not give you the right answer.
Why this matters
Scotland uses LBTT, not SDLT. The bands are different and the additional dwelling supplement is higher. If you buy in Scotland, calculate using Scottish tax rules, not English ones.
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