Knight Frank comments on LBTT changes

Changes to Land and Buildings Transaction Tax (LBTT) come into force in Scotland on Friday, 25th January. The upper rate for commercial property has increased from 4.5% to 5%.

Rhu Wishart, Surveyor at Knight Frank in Edinburgh, commented:

“As of Friday 25th January, Land and Buildings Transaction Tax – or LBTT – will incur changes to the amounts payable on non-residential property transactions.

“The rates and bands are to be amended but the incremental banding system will remain. The new higher LBTT rate of 5% payable on any transaction over £250,000 is accompanied by a reduction in the lower rate from 3% to 1%. While we don’t expect the change to impact on confidence or investment in the Scottish market, investors will need to factor it into cash-flow and valuations considerations.

“The changes to the tax rate aside, Scotland, and Edinburgh in particular remains an extremely popular location as a place to live, study and visit. While the occupational markets remain buoyant, we expect Edinburgh to remain high on investors wish lists.