Ukrainian Refugee Faces £9,000 Tax on War-Zone Property
Scottish property tax rules penalize refugees owning homes in active conflict zones.
1Unexpected Financial Barrier
Kateryna Stepanovych, a Ukrainian refugee living in Scotland, faces a £9,000 tax bill when attempting to purchase a home in North Ayrshire. The charge stems from the Additional Dwelling Supplement, which applies to anyone owning another property globally. This unexpected cost forced the couple to withdraw their recent property offer.
2War-Zone Asset Complications
Stepanovych owns a flat in Kyiv purchased in 2018, long before the Russian invasion. Although the building sustained shrapnel damage during a 2023 attack, the apartment remains standing. Despite the property being located in an active war zone, current Scottish tax regulations treat it as a standard second home investment.
3Rigid Legislative Framework
Revenue Scotland enforces the Additional Dwelling Supplement to target buy-to-let investors and second-home owners. The legislation currently lacks provisions for discretionary exemptions, even in extreme humanitarian circumstances. Consequently, officials confirmed that neither the government nor the tax authority has the legal power to waive this specific surcharge for the couple.
4Parliamentary Intervention Efforts
Liberal Democrat MSP Liam McArthur raised the couple's plight in the Scottish Parliament this Tuesday. He questioned First Minister John Swinney regarding whether this tax was intended to penalize refugees fleeing conflict. Swinney acknowledged the difficulty of the situation and requested that Revenue Scotland investigate the specific details of this case.
5Impact on Refugee Integration
The financial burden has significantly disrupted the couple's plans to relocate and settle permanently in Scotland. Kateryna, who works in a factory, described the administrative process as overwhelming, especially given the language barrier. They are now forced to postpone homeownership indefinitely and consider renting while waiting for a potential policy resolution.
6Tax Policy Context
The Additional Dwelling Supplement is an 8% charge applied on top of the standard Land and Buildings Transaction Tax. While designed to stabilize the housing market by discouraging multiple property ownership, it creates unintended consequences for individuals displaced by war. This case highlights the lack of flexibility in current property tax statutes.
7Administrative and Legal Hurdles
The couple previously contacted Deputy First Minister Jenny Gilruth to seek relief from the tax. The official response emphasized that the legislation does not allow for case-by-case exceptions. This legal deadlock leaves the couple with limited options, as they cannot afford the extra £9,000 while maintaining their current living arrangements.
8Future Outlook and Uncertainty
While the First Minister has promised an investigation, there is no guarantee of a legislative change. The couple remains in a state of limbo, biding their time in Orkney while exploring alternative options. Their situation serves as a stark example of how rigid tax policies can inadvertently impact vulnerable populations seeking stability.
Original article: BBC News – Scotland — Ukrainian Refugee Faces £9,000 Tax on War-Zone Property