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Application of surcharge

Application of the supplement when the buyer is not an individual and treatment of married couples. Civil partners and cohabitants

Non – natural persons

The LBTT supplement will apply to all purchases of residential properties by companies and other such non-natural persons, irrespective of whether or not they already own a residential property. A potential tax avoidance opportunity would be created if companies and similar bodies were allowed to purchase one residential property without the supplement applying to it, in the way individuals can.

Married couples, civil partners and cohabitants

Married couples, those in a civil partnership and cohabitants (those living as if a married couple), along with their dependent children, will be treated for the purposes of the LBTT supplement as one economic unit. The supplement will therefore apply in a scenario where one spouse owns the existing marital home and then the other spouse purchases an additional residential property. In this scenario the married couple would end up with the same LBTT liability as a married couple jointly owning the home they currently live in and then jointly buying an additional residential property together.

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