Question about ADS tax in Scotland

[Kelvin]

We are in the process of completing the purchase of a plot of land in Scotland (currently live in England) 
 

We are discussing where to live during the process. The plan is to sell our main residence in England and move to Scotland. We have two dogs and six chickens and the likelihood of finding a rental place that will take pets is limited. We are considering buying a new small main residence in Scotland i.e. sell our house in England and find a suitable place in Scotland to live in while we build the house. 
 

What we ideally want to do is find a place that would ultimately be suitable as a holiday rental. Therefore when we finish the self-build we move into that and rather than sell the small house we turn it into a holiday let. What I can’t quite figure out is the tax position we might find ourselves in with the additional dwelling tax supplement. 

[newhome]

House sales in Scotland are mad currently. Where I live as soon as a property comes on the market it is sold unless there is something wrong with it or it’s overpriced. Can’t you put a caravan on the land and live there with your animals? 

[ProDave]

Another one suggesting a static caravan on your plot might be the best option.

 

The ADS question is interesting. You already own the plot, but don't own a dwelling so I would think you pay none of that if you bought another house.  And I have a feeling building a house on your plot would not trigger it either as there is no "sale"  In much the same way buying a plot is usually below the threshold for paying LBTT, but then building a house on it does not trigger paying any LBTT.

[Ferdinand]

You can fund two? And know that the other one will be a suitable holiday let? Would PP be necessary / achievable?

 

One option may be to build a "wee hoose" or a "cabin" on your plot to live in, then treat that as a lettable annexe, family visitor accommodation,  or holiday home. But perhaps adds other complexity.

See for example

 

Lots of options, and you just need to find the right one.

 

F

 

[Dave Jones]

eat the chickens ?

[Kelvin]

We’ve considered a static caravan but the other half couldn’t easily do her job from home. Plus I reckon we are in for a 18 month to 2 year journey so that’s a long time to be in one.

 

They are rescue chickens  and old birds so not much eating there plus they all have names and I reckon it’s hard to eat things you’ve named ? 

 

The wee hoose idea is something else we are considering but we’d still end up with a period of time where we’d need to find somewhere to live.

 

@ProDave this exactly my thinking too. I’m seeing my solicitor next week so will chat to him about it.

 

In terms of founding both, just about I think. Finding a suitable place we can afford that we could then turn into a holiday let will be  the challenge. The alternative is just to buy a small place and then sell it when the house is ready. It will work out cheaper than renting assuming we could even find somewhere to rent.

[Kelvin]

Spoke to my solicitor yesterday and my understanding of the LBTT/ADS situation is right. So buy plot of land nothing to pay. Sell current house and buy another house in Scotland (and we may have found the perfect house less than a mile from the plot) no ADS there either subject to timing the buying and selling and you can claim it back anyway. Buying somewhere to live takes all the pressure off doing anything with plot too and maybe we can ride out the current supply chain and trades availability problems as that seems like a World of stress right now. Also allows me to figure out what I am going to do workwise as I quit my stressful job too! ? 

[Ferdinand]

Buy plot, get planning, build house is perhaps more like 2-5 years after you have bought the plot.