This guidance covers Land and Buildings Transaction Tax, the collection process on transfer of title, and how it affects the application process.
You'll need to pay Land and Buildings Transaction Tax on notifiable transfers of property.
For more detailed guidance on Land and Buildings Transaction Tax, see the Revenue Scotland website.
From 1 April 2015, Land and Buildings Transaction Tax (LBTT) replaced Stamp Duty Land Tax (SDLT) for property transactions in Scotland.
Full guidance on LBTT and the process of submitting returns is available on the Revenue Scotland website.
The introduction of LBTT resulted in some key changes to the collection of stamp duty on land and property transactions under SDLT provisions, and also to the application process for deeds submitted for registration in the land register and the Books of Council and Session (Books of C&S).
Under LBTT, Revenue Scotland is responsible for the collection and management of LBTT. Certain functions relating to the administration of manual returns and cheque payments for LBTT have been delegated to us.
With regard to cheque payments:
- Paper LBTT returns and LBTT-related cheque payments can be either submitted by post or hand-delivered to our office at Meadowbank House, 153 London Road, Edinburgh, EH8 7AU. When making a paper LBTT return, any accompanying cheque for tax payment must be submitted in the same envelope.
- Cheques for the payment of LBTT must be made out to Revenue Scotland.
- The amount entered on the cheque payment must match the tax amount entered on the LBTT return.
- Separate cheques are required for LBTT payments and RoS registration fees - LBTT payments and RoS registration fees cannot be combined on one cheque.
- When making an online LBTT return and selecting cheque as the method of payment, we must receive the cheque by the third working day after the submission of the return.
- When making an online LBTT return and selecting cheque as the method of payment, the unique ID generated by the online system must be written on the back of the cheque. This unique ID should not be added to any application form submitted for registration.
- Under LBTT, there is no paper equivalent to the SDLT5 certificate.
The provisions of section 43(1) of the Land and Buildings Transaction Tax (Scotland) Act 2013 (the LBTT Act) prevent us from accepting a document for registration that effects or evidences a notifiable transaction unless a land transaction return has been made in relation to that transaction and any tax payable in respect of that transaction has been paid (or where arrangements satisfactory to Revenue Scotland have been made for payment of the tax).
Revenue Scotland provide us with details of all valid land transaction returns made online in order that we may assess whether the provisions of section 43(1) of the LBTT Act, in relation to relevant applications for registration, have been met. As a result, neither Revenue Scotland-generated acknowledgements of electronic LBTT returns nor any other type of Revenue Scotland LBTT-related documentation should be included when submitting related registration applications.
The following LBTT-related questions have been added to both the land register and the Books of Council and Session (Books of C&S) application forms to help us meet our duties under section 43(1) of the LBTT Act:
"Is the transaction to which this application relates a notifiable transaction in terms of section 30 of the Land and Buildings Transaction Tax (Scotland) Act 2013?
Yes or No
If yes, has a land transaction return been made, and have arrangements satisfactory to the tax authority been made for the payment of any tax payable in respect of the transaction?
Yes or No"
These LBTT-related questions must be answered for all applications to register a document effecting or evidencing a notifiable transaction in either the land register or the Books of C&S.
Regarding the LBTT-related questions:
- A transaction may attract either SDLT or LBTT, but not both. Which tax is payable depends on the effective date for that transaction. In turn, this will determine how the LBTT-related questions should be answered.
- Where the effective date of a transaction is prior to 1 April 2015, SDLT will be payable and an SDLT5 certificate should be included with the relevant registration application. The LBTT-related questions should be answered as "No/No".
- Where the effective date of a transaction is on or after 1 April 2015, LBTT will be payable (subject to the exception at the bullet point immediately following). In this case, the LBTT-related questions should be answered "Yes/Yes" only where either a valid LBTT return has already been made online to Revenue Scotland and any tax payable in respect of the transaction paid (or arrangements satisfactory to Revenue Scotland made) or a paper LBTT return and a cheque for any LBTT payable is being submitted to us in the same envelope as the registration application.
- Where missives for a transaction have been concluded before 1 May 2012 (the date on which the Scotland Act 2012 came into force) and the effective date of the transaction is on or after 1 April 2015, SDLT will continue to be payable and this should be declared on the application form in order to avoid the possibility of rejection. An SDLT5 certificate should also be included with the relevant registration application. In this case, the answers to the LBTT-related questions should be given as "No/No".
- When an application does not relate to a notifiable transaction but it is not evident from the face of the deed that this is so, the notifiable transaction question should be answered "No" and the additional information box of the application form should be used to provide an explanation as to why.
Transitional guidance on the introduction of Land and Buildings Transaction Tax can be found on gov.uk.
Books of Council and Session
A Books of C&S application form (the C&S1 form) must accompany any application to register a deed in the Books of C&S effecting or evidencing a notifiable transaction. The form is available for download from our website and as part of our eServices system.
Use of the C&S1 form is mandatory for deeds relating to notifiable transactions. Under the Land and Buildings Transaction Tax (Ancillary Provision) (Scotland) Order 2014, an application for registration of such a deed need not be accepted in the Books of C&S unless the application provides the information required to enable compliance with section 43(1).
The form has the support and agreement of both the Lord President of the Court of Session and the Law Society of Scotland and, although its use is mandatory only in respect of notifiable transactions, we strongly encourages applicants to use it for all Books of C&S applications. Where it is unclear from the terms of the deed that the transaction is not notifiable, it would be of assistance if the position was confirmed on the C&S1 form.