Land and Building Transaction Tax

Land and Buildings Transaction Tax (LBTT) is Scotland’s equivalent of Stamp Duty Land Tax (SDLT), applicable since April 2015. LBTT is payable on the acquisition of land or property in Scotland. Here’s an overview:

Who Pays LBTT?

LBTT is paid by the purchaser in any land transaction in Scotland. It replaces SDLT, which applies in England and Northern Ireland, while Land Transaction Tax (LTT) applies in Wales.

What is a Land Transaction?

Any transaction involving the acquisition of an interest in land triggers LBTT liability. This includes buying property, creating or assigning leases.

When is LBTT Payable?

LBTT is payable when a contract is substantially performed—usually at completion when the buyer takes possession. However, if the buyer takes possession before completion (“resting on contract”), the tax becomes due at that point.

Residential LBTT Rates (Effective from 1 April 2021):

The rates apply to the portion of the property price that falls within each band.

First-Time Buyer Relief

First-time buyers can benefit from LBTT relief on properties up to £175,000, raising the zero-tax threshold from £145,000 to £175,000, with a maximum relief of up to £600.

Higher Rates for Additional Properties

For buy-to-let properties or second homes, higher rates of LBTT apply (6% above the standard rates). Refunds may be available if a previous main residence is sold within 18 months (to be extended to 36 months).

Key points:

• The higher rates apply if the purchaser owns more than one property by the end of the purchase day.
• Refunds can be claimed within 18 months of selling the original main residence.
• The 18-month period will soon be extended to 36 months following a consultation.

Non-Residential LBTT Rates:

LBTT calculators to estimate liability are available on the Revenue Scotland website.

How We Can Help

For guidance on LBTT, particularly if you’re in the Nottingham area, reach out to us at AHACCOUNATANTS for personalized assistance.

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Land and Buildings Transaction Tax (LBTT) is Scotland’s equivalent of Stamp Duty Land Tax (SDLT), applicable since April 2015. LBTT is payable on the acquisition of land or property in Scotland. Here’s an overview:

Who Pays LBTT?

LBTT is paid by the purchaser in any land transaction in Scotland. It replaces SDLT, which applies in England and Northern Ireland, while Land Transaction Tax (LTT) applies in Wales.

What is a Land Transaction?

Any transaction involving the acquisition of an interest in land triggers LBTT liability. This includes buying property, creating or assigning leases.

When is LBTT Payable?

LBTT is payable when a contract is substantially performed—usually at completion when the buyer takes possession. However, if the buyer takes possession before completion (“resting on contract”), the tax becomes due at that point.

Residential LBTT Rates (Effective from 1 April 2021):

The rates apply to the portion of the property price that falls within each band.

First-Time Buyer Relief

First-time buyers can benefit from LBTT relief on properties up to £175,000, raising the zero-tax threshold from £145,000 to £175,000, with a maximum relief of up to £600.

Higher Rates for Additional Properties

For buy-to-let properties or second homes, higher rates of LBTT apply (6% above the standard rates). Refunds may be available if a previous main residence is sold within 18 months (to be extended to 36 months).

Key points:

• The higher rates apply if the purchaser owns more than one property by the end of the purchase day.
• Refunds can be claimed within 18 months of selling the original main residence.
• The 18-month period will soon be extended to 36 months following a consultation.

Non-Residential LBTT Rates:

LBTT calculators to estimate liability are available on the Revenue Scotland website.

How We Can Help

For guidance on LBTT, particularly if you’re in the Nottingham area, reach out to us at AHACCOUNTANTS for personalized assistance.