Example:

Matt and Chris are selling their existing main residence and purchasing a dwelling together which they will use as their next main residence. Both transactions are due to complete on the same day. A few days before the sale of their existing main residence completes, the buyer advises that his mortgage will be delayed by a week. Matt and Chris's next main residence purchase transaction cannot, however, be delayed and this duly completes on the expected day.

Matt and Chris's next main residence purchase comprises a notifiable transaction therefore an LBTT return requires to be made and any LBTT due paid within 30 days of the effective date of that transaction. As the sale of their previous main residence will only be delayed for a few days and as they will have no mortgage over the dwelling being purchased, Matt, Chris and their solicitor decide to delay making the LBTT return (and also registration of the Disposition in their favour) until the sale of their previous main completes.

The sale of their previous main residence duly completes three days later, at which point an LBTT return is made for the next main residence purchase transaction, within the 30 day filing period, and an application to register the Disposition in favour of Matt and Chris is submitted to the Keeper.

At the end of the day that was the effective date of their next main residence purchase transaction, Matt and Chris owned two dwellings and had not replaced a main residence. However, as their previous main residence was sold within an 18 month period beginning with the day after the effective date of their next main residence purchase transaction and an LBTT return had not been made for the next main residence purchase transaction before the sale completed, Matt and Chris did not have to pay the ADS.

Last updated: 
6 April 2016
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