Following a consultation last year, the Scottish Government plans to introduce a new tax in the form of the Scottish Building Safety Levy (SBSL) on 1 April 2027 via the Building Safety Levy (Scotland) Bill. The Bill was introduced into the Scottish Parliament last month.
The Bill was introduced in response to the Grenfell Tower fire, and funds raised from the SBSL will provide funding for Scotland’s Cladding Remediation Programme to replace unsafe and defective cladding on high-rise buildings (with a height of 11 metres or more).
Who is affected?
Under the terms of the Bill, it is proposed that the new SBSL will apply to:
- New homes built by developers for sale
- New purpose-built accommodation, such as student accommodation / flats and build-to-rent properties
- New development of existing buildings to provide residential accommodation
The Bill also proposes that there will be some exemptions to the Levy, for example in respect of social and affordable housing.
How is it calculated?
The SBSL will be based on the floor space of the development, but the levy may vary depending of geographic area and land type (eg brownfield vs greenfield development). There will also be a levy-free allowance too.
As it will be a self-assessed tax, affected organisations will be required to submit a tax return to Revenue Scotland and pay the SBSL.
How can we help?
Here at CT, we work with a number of property developers and can help you navigate you the myriad of taxes and reliefs which affect those in the property sector, whether it be Land and Buildings Transaction Tax, Annual Tax on Enveloped Dwellings, Corporation Tax matters and Capital Allowances to name but a few.
If you have any questions, please contact your usual CT contact or our Personal Tax specialists at personaltax@ct.me.
We will keep you updated once further details are announced.
