In Scotland, a downsize completed before the old home sells carries an extra 8% Additional Dwelling Supplement on top of the standard property tax, charged on the whole price of the new home. On a £300,000 purchase that's £24,000, repayable if the old home sells within three years.
Selling a bigger house and buying a smaller one can bring a retirement date forward — see how much do I need to retire. The money that reaches your bank account is the difference between the two prices, less tax, fees and the cost of the move itself.
In Scotland, completing the purchase before the old home sells adds an extra tax charge on top of the standard rates, calculated on the whole price of the new home.
Scotland does not charge Stamp Duty Land Tax. Since April 2015 it has run its own property tax, Land and Buildings Transaction Tax (LBTT), on its own bands, collected by Revenue Scotland. A calculator built for England or Wales gives the wrong figure on a Scottish purchase.
0%. This nil-rate threshold applies to a main-residence purchase.
2% on the slice above £145,000.
5% on that slice. Each band taxes only the portion of the price that falls inside it.
10% to £750,000, then 12% on anything above that.
If you own more than one residential property on the day the new purchase completes, Revenue Scotland adds the Additional Dwelling Supplement (ADS): a flat 8% charged on the whole price of the new home, on top of the standard LBTT bands above. It applies once the price reaches £40,000, and it is not a second set of bands — it sits on top of whatever the main rates already charge. The rate rose from 6% to 8% for purchases where missives conclude on or after 5 December 2024.
ADS applies when you own the old home and the new one on completion day, including when the old home is on the market, under offer, or sold subject to conditions that haven't completed yet. Your plans for the old house make no difference to the charge; ownership on completion day does.
Sell the previous main residence within 36 months of completing the new purchase and the whole 8% supplement is repayable, claimed online through Revenue Scotland within 12 months of that sale. The ADS still has to be paid in cash on completion day, before the old house's equity is released.
Morag and Ian are selling their house outside Stirling for £410,000, mortgage-free, and buying a bungalow in Bridge of Allan for £300,000. On paper, that releases £110,000 towards the retirement they've been planning around.
LBTT on £300,000 at the main rates: £0 on the first £145,000, 2% on the next £105,000 (£2,100), 5% on the remaining £50,000 (£2,500). Total £4,600.
Solicitor-estate agent fee at 1.2% of the sale price (£4,920), a Home Report to market the old house (£500), separate legal fees on the purchase (£900), the move itself (£3,000) and the £4,600 of LBTT. Real net release: £96,080, not £110,000.
Same £300,000 purchase, but Morag and Ian now own two homes on completion day. The standard £4,600 of LBTT still applies, and the Additional Dwelling Supplement adds 8% of the whole £300,000 on top: £24,000. Total due on completion: £28,600.
£24,000 more, needed in cash on completion day. It is repayable in full if the Stirling house sells within 36 months.
A projection built on “£110,000 from downsizing” overstates the release: the net figure above is £96,080. If the chain breaks and no cash is set aside for the supplement, it can be short by a further £24,000 on moving day.
Wales charges a separate, higher set of bands on an additional property, with its own thresholds. Scotland charges the standard LBTT bands and adds a flat 8% on top of the whole price.
Northern Ireland charges Stamp Duty Land Tax, the same bands HMRC applies in England, with no equivalent supplement for buying an additional property while another is still owned.
Whether the old home sells before or after the new one completes is the difference between £4,600 and £28,600 on the numbers above.
Put into a retirement projection what's left after LBTT, any ADS, solicitor and agent fees, and the move itself. In the example above that is £96,080 of a £110,000 difference.
Your solicitor will confirm the precise amount for your actual purchase price before missives conclude. Don't estimate it from a band table, including this one.
Find out before missives conclude whether completion might land before the old home sells, and decide where the ADS cash would come from if it does.
Sale price, minus the new purchase price, minus LBTT and any ADS, minus solicitor and agent fees, minus the move itself. Use that number in a projection.
Put the net amount into the free projection and see what it does to the age your money runs out.
Where a business sale, a pension decision and a house move are all landing in the same few years, the Financial Plan models them together. If your own spending figure is still a guess, the free Healthcheck works it out in about two minutes.
It's an extra charge added on top of the standard LBTT bands, worked out separately and added to what's due. Revenue Scotland first calculates the standard LBTT on the main residential bands, then adds the Additional Dwelling Supplement of 8% on the whole purchase price if you own more than one residential property on completion day. The two amounts are added together and both are due on completion. Your solicitor submits a single LBTT return covering both figures, due within 30 days of the effective date, though in practice the whole amount is settled through the conveyancing funds on completion day itself. There's no separate form for the supplement and no separate payment date. It travels with the ordinary LBTT return as one figure added to another.
The whole price. Once a purchase reaches £40,000, the Additional Dwelling Supplement is 8% of the entire consideration from the first pound. There is no slice-by-slice calculation the way the main LBTT bands work: a £300,000 purchase caught by ADS carries £24,000 of supplement, calculated on the full £300,000, on top of the £4,600 of standard LBTT. Below £40,000 the supplement doesn't apply at all, so a small additional purchase, such as a minority share inherited alongside a sibling, can sit under the threshold and escape it entirely. Because the main LBTT bands tax only the slice of a price inside each band, while the supplement taxes the whole figure in one go, the supplement makes up a bigger share of the total bill on a cheaper property than on an expensive one.
Through an online reclaim submitted to Revenue Scotland once your previous main residence has sold. You have 36 months from the date the new purchase completed to sell the old home and qualify, and the reclaim itself has to be submitted within 12 months of that sale. The repayment covers the ADS element in full, calculated on the same purchase price the supplement was originally charged on. You'll need the reference from the original LBTT return and the completion date of the sale to hand when you submit the claim, and your solicitor can usually handle it on your behalf if they're still instructed. The main LBTT due on the purchase isn't affected either way. Only the supplement itself is repaid, and only once the sale that triggered it has gone through.
Yes. Revenue Scotland looks at how many residential properties you own worldwide at the moment the Scottish purchase completes. A flat in Spain, a buy-to-let in Leeds or a house still owned in Northern Ireland all count on exactly the same basis as a property in Scotland. The location of the property you already own doesn't change the charge; owning a second residential property anywhere does. One exception can help: since 1 April 2024, a share in a jointly owned or inherited property is disregarded if that share is worth less than £40,000, even where the whole property is worth far more. A small inherited stake alongside siblings, for example, may not count against you, though a solicitor should confirm the valuation of your specific share before you rely on it.
It can. If either buyer on a joint purchase already owns another residential property anywhere, and that property isn't being sold as part of replacing it with the new one, the whole purchase can be caught by the Additional Dwelling Supplement, even though the two of you will only ever live in the home you're buying together. Whether it applies depends on the detail of what each of you owns and what happens to it, which a solicitor should confirm before missives conclude.
No. That's your solicitor's job, and whether a specific purchase falls under the Additional Dwelling Supplement depends on the live detail of your chain and what each buyer owns. We model the effect once you know the numbers: the figure for a sale that completes first and the figure for a purchase that completes first, run through a retirement projection, so you can see the cost of each timing before you decide. On the worked example above, that is LBTT of £4,600 against a combined £28,600 with the supplement added.
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