Example:

April and Candy purchase an additional dwelling for £300,000 which they intend to live in as their main residence, before they sell their previous main residence.

As, at the end of the day that is the effective date of the transaction, April and Candy own more than one dwelling and have not replaced their main residence, the ADS will apply. The total amount of LBTT and ADS paid is £13,600.

April and Candy use their newly purchased dwelling as a main residence, and six months later, sell their previous main residence. As they are disposing of a previous main residence within a period of 18 months beginning with the day after the day that is the effective date of their next main residence purchase transaction, April and Candy are eligible to claim a repayment of the ADS paid.

April and Candy, or their solicitor acting on their behalf, can reclaim the ADS paid by amending the LBTT return made for that transaction.

The amount of tax claimed in the repayment would be £9,000, which is 3% of the £300,000 consideration they paid for the dwelling.

Last updated: 
6 April 2016
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