DAVID ALEXANDER joint managing director of apropos by DJ Alexander Ltd, commented: “It is welcome news that the Scottish government has left land and buildings transaction tax (LBTT) unchanged for individuals and landlords. Scotland’s homeowners and property investors already pay substantially more in tax than the rest of the UK and any risk of widening the gap between here and the rest of the UK needs to be avoided.”
David continued: “Scotland has 158,505 landlords providing 414,000 properties and they pay substantially higher sums both to buy properties, and in personal taxation than their counterparts south of the Border. The importance of the Private Rented Sector (PRS) in Scotland is highlighted by its growth over the last two decades. Between 1999 and 2018 the PRS in Scotland has grown from 5% to 14% of total housing stock whilst social housing has declined from 32% to 23% over the same period.”
“The tax liability in buying a rental property is substantially higher in Scotland than the rest of the UK. A landlord buying a home for £200,000 in Scotland will pay £9,100 in land and building transaction tax (LBTT + ADS) whilst the same purchase in England would cost just £7,500 in stamp duty land tax (SDLT). Equally the personal tax liability is much higher in Scotland. A Scottish landlord earning £50,000 per annum will pay substantially more in personal tax than in England.”
David concluded: “We need to ensure that Scotland is welcoming to individuals, investors and companies who want to live and work in our country. That means ensuring that we can attract investment and the best people to work in Scotland. The latest budget states that Scots earning above £27,243 will pay more which affects 44% of the population. This is hardly a high level of income and we need to have an environment which encourages wealth creation, entrepreneurship and growth. Equally, providing homes for individuals is an essential element in the growth of any society and the PRS now represents a substantial part of this market in Scotland. Ensuring it remains viable for individuals and investors must surely be key to building a dynamic and developing Scotland.”
