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Land and Buildings Transaction Tax

The Land and Buildings Transaction Tax (LBTT) is a tax applied to residential and non-residential land and buildings transactions (including commercial leases).

LBTT is administered by Revenue Scotland, with support from Registers of Scotland (RoS).

LBTT replaced UK Stamp Duty Land Tax in Scotland on 1 April 2015, following the passage of the Scotland Act 2012 and the subsequent Land and Buildings Transaction Tax (Scotland) Act 2013. This has since been amended through the use of primary and secondary legislation.

Tax is payable at different rates on each portion of the purchase price within specified tax bands.

As well as this, the Additional Dwelling Supplement, charged at 4%, may apply.

Detailed information, including guidance on how to submit or amend a tax return, guidance on reliefs and exemptions and worked examples can be found on the Revenue Scotland website. Tax calculators based on current rates and statistics on LBTT transactions and revenues are also available.

Residential LBTT

Rates from 1 April 2021

As confirmed in Scottish Budget 2021-22, the current rates and bands for residential LBTT are as follows:

Purchase price

LBTT rate

Up to £145,000

0%

£145,001 to £250,000

2%

£250,001 to £325,000

5%

£325,001 to £750,000

10%

Over £750,000

12%

First-Time Buyers

A relief for first-time buyers is available, which increases the residential nil rate band of LBTT to £175,000.

From 1 April 2021, the availability of the relief will result in a reduction in tax of up to £600 for qualifying first-time buyers, relative to the rates which would have otherwise applied.

More information including first-time buyer FAQs is available on the Revenue Scotland website.

Additional Dwelling Supplement

On 1 April 2016 the LBTT Additional Dwelling Supplement (ADS) came into force, payable on the total purchase price of an additional dwelling of £40,000 or more.

The ADS is charged at 4% of the total purchase price of the dwelling.

The supplement forms an important element of the Scottish Government’s drive to protect opportunities for first-time buyers in Scotland, reinforcing the progressive approach in place for LBTT rates and bands.

Further information and guidance regarding the ADS is available on the Revenue Scotland website.

Non-residential LBTT

Non-residential LBTT rates and bands are set out in the tables below. No changes to these rates were announced as part of Scottish Budget 2021-22.

Conveyances

Purchase price

LBTT Rate

Up to £150,000

0%

£150,001 to £250,000

1%

Over £250,000

5%

Leases

NPV of rent payable

LBTT Rate

Up to £150,000

0%

£150,001 to £2 million

1%

Over £2 million

2%

Other Scottish Budget 2021-22 updates

Investment Related Reliefs

The Scottish Government announced in the Scottish Budget 2021-22 that, as a result of the impact of COVID-19 and the continued uncertainty around the terms of the UK’s future relationship with the EU, it has not been possible to issue a planned consultation on legislation to provide for proposed targeted LBTT reliefs related to: the ‘seeding’ (initial transfer) of properties into a Property Authorised Investment Fund (PAIF) or Co-owned Authorised Contractual Scheme (CoACS); and the exchange of units within a CoACS.

This will now be a matter for the next Scottish Parliament.