Land and Buildings Transaction Tax in Scotland (LBTT)

When do you pay LBTT?

An LBTT return (and any tax due) must be submitted within 30 days beginning with the day after the transaction’s effective date (this is usually the date of settlement/completion).

In practice, LBTT is effectively dealt with at settlement. Your solicitor needs to be “in funds” for the purchase price and any LBTT due before the transaction can settle, because they usually can’t complete registration until the LBTT return has been made and any tax due has been paid. The payment is normally made by the solicitor from the funds you provide — you don’t pay Revenue Scotland directly.

Important: An LBTT return is generally required for purchases over £40,000, even if the LBTT due is £0.

Rates for primary residences (standard residential LBTT rates)

Land and Building Transaction Tax is charged on the portion of the price within each band (similar to income tax). Here are the current standard rates:

Purchase price under £145,000

No tax is charged on properties under £145,000.

Purchase price between £145,001 and £250,000

Buyers don’t pay tax on the first £145,000. They then pay 2% on the portion of the price between £145,001 and £250,000.

Purchase price between £250,001 and £325,000

Buyers don’t pay tax on the first £145,000. They then pay:

• 2% on the portion between £145,001 and £250,000, and

• 5% on the portion between £250,001 and £325,000.

Purchase price between £325,001 and £750,000

Buyers don’t pay tax on the first £145,000. They then pay:

• 2% on the portion between £145,001 and £250,000,

• 5% on the portion between £250,001 and £325,000, and

• 10% on the portion between £325,001 and £750,000.

Purchase price £750,001 and over

Buyers don’t pay tax on the first £145,000. They then pay:

• 2% on the portion between £145,001 and £250,000,

• 5% on the portion between £250,001 and £325,000,

• 10% on the portion between £325,001 and £750,000, and

• 12% on the portion above £750,000.

First-time buyer relief (worth knowing)

If you’re an eligible first-time buyer, you may pay 0% LBTT on the first £175,000 (instead of £145,000). This can reduce the amount of tax you pay when buying your first home.

Buying an additional property?

If you’re buying an additional residential property (for example, a second home or a buy-to-let), an Additional Dwelling Supplement (ADS) may apply on top of LBTT. ADS is currently 8% in many cases, but the rules can be detailed — your solicitor will confirm what applies to your purchase.

What about the rest of the UK?

If you’re buying in England and Northern Ireland you’ll pay Stamp Duty Land Tax (SDLT).