Mike_scotland Posted October 3, 2019 Share Posted October 3, 2019 Hi, Please ignore my ignorance but do you pay second home tax on a plot of land you buy to build a home? im going to say you dont because its not a house but just wanting to make sure. Link to comment Share on other sites More sharing options...
Conor Posted October 3, 2019 Share Posted October 3, 2019 Depends on what you mean as tax. We had to pay higher rate of stamp duty on our purchase. We get to reclaim this shortly as we're selling our current home within the three year time limit. I don't think capital gains tax applies either. As long as your not renting out either property, I just see it as a transition from one primary residence to another. Link to comment Share on other sites More sharing options...
Mike_scotland Posted October 3, 2019 Author Share Posted October 3, 2019 well im buying a plot of land for 80k and i already own a house im staying in while i build my new home, im just wondering if im due anything like second home tax im under the threshold for stamp duty as that is 145k im sure. Link to comment Share on other sites More sharing options...
Jeremy Harris Posted October 3, 2019 Share Posted October 3, 2019 I think it may depend on where you live, so worth checking. Here, when we bought our plot we didn't have to pay stamp duty, and until the house was built and almost finished we didn't have to pay council tax either. I was threatened with having to pay council tax at 150%, as a second home, shortly after we were issued with a completion certificate, but I provided evidence to the local authority that we were self-builders, that our existing home was on the market, and that our intention was that our self-build would be come our principal residence. They gave us a 6 month period of grace before they would start to charge us council tax at 150% on the new build. I had the impression that they would have been OK to extend this period of grace if we had trouble selling our old house, subject to us providing them with evidence. 1 Link to comment Share on other sites More sharing options...
bassanclan Posted October 3, 2019 Share Posted October 3, 2019 The extra 3% tax does NOT apply to land, only homes. If you were buying a demolish and rebuild plot then you would have to pay the 3% tax, or get it demolished before you buy Link to comment Share on other sites More sharing options...
nod Posted October 3, 2019 Share Posted October 3, 2019 1 hour ago, JSHarris said: I think it may depend on where you live, so worth checking. Here, when we bought our plot we didn't have to pay stamp duty, and until the house was built and almost finished we didn't have to pay council tax either. I was threatened with having to pay council tax at 150%, as a second home, shortly after we were issued with a completion certificate, but I provided evidence to the local authority that we were self-builders, that our existing home was on the market, and that our intention was that our self-build would be come our principal residence. They gave us a 6 month period of grace before they would start to charge us council tax at 150% on the new build. I had the impression that they would have been OK to extend this period of grace if we had trouble selling our old house, subject to us providing them with evidence. So much for encouraging self builds We where paying 50% CT on our build Twelve months before we had power or water Link to comment Share on other sites More sharing options...
Mike_scotland Posted October 4, 2019 Author Share Posted October 4, 2019 Hi guys, Thanks for the help - it will be something i look out for with the council tax, always trying to squeeze the little man - there is people out there who pay no council tax let alone for 2 properties(when the additional property is being built!) Link to comment Share on other sites More sharing options...
Ferdinand Posted October 4, 2019 Share Posted October 4, 2019 1 hour ago, Mike_scotland said: always trying to squeeze the little man ?? Link to comment Share on other sites More sharing options...
eandg Posted October 4, 2019 Share Posted October 4, 2019 (edited) 16 hours ago, Mike_scotland said: well im buying a plot of land for 80k and i already own a house im staying in while i build my new home, im just wondering if im due anything like second home tax im under the threshold for stamp duty as that is 145k im sure. We didn't (in Scotland) - our solicitor had to complete an LBTT return but no Additional Dwelling Supplement was due as there is no additional dwelling. Edited October 4, 2019 by eandg Link to comment Share on other sites More sharing options...
ProDave Posted October 4, 2019 Share Posted October 4, 2019 They do seem less bothered in Scotland. Our plot was under the stamp duty threshold, and not second property tax. Even the council tax, they seem happy for us to pay band A for the caravan and seem in no hurry to value the not yet finished house. Link to comment Share on other sites More sharing options...
Mike_scotland Posted October 4, 2019 Author Share Posted October 4, 2019 Hi Guys, My solicitor confirmed this morning that no LBTT is to be paid due to the fact its under the threshold (145k i think) and no second home tax as it is not a second home its a field with potential haha, but she did note that i cant start building until the sale is fully through as they can then say its a dwelling. (obviously i wouldnt be but just a side note) Cheers guys, i look forward to speaking to more of you in the coming months when i start a blog Mike Link to comment Share on other sites More sharing options...
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