Guidance on Understanding ‘Tax Position’ in Relation to Devolved Taxes

Meaning of “Tax Position” for Scottish Devolved Taxes

Under the Revenue Scotland and Tax Powers Act 2014, a person’s “tax position” is a wide concept covering their overall position in relation to devolved taxes such as LBTT and Scottish Landfill Tax. It includes not only tax due now, but also past and future liabilities, penalties, repayments, and procedural matters like claims, elections, applications, and notices.

• It applies to a person’s position at any time and for any period in relation to any devolved tax.
• It covers past, present, and future tax liabilities, as well as penalties and other amounts paid or payable by or to the person.
• It also includes procedural steps, such as whether claims, elections, applications, or notices have been made correctly or can still be made.
• The term is broader than the amount shown on a tax return, so later events, amendments, enquiries, or relief claims may still affect the position.
• For this purpose, a “person” includes someone who has died and a company that has been dissolved.

Scroll down for the full analysis.

What “tax position” means for devolved taxes in Scotland

This page explains the legal meaning of a person’s “tax position” under the Revenue Scotland and Tax Powers Act 2014. The term is broad. It does not just mean whether tax is due now. It covers a person’s overall position in relation to devolved taxes, including liabilities, repayments, penalties, and procedural steps such as claims and elections. This matters because the term can affect how Revenue Scotland’s powers are applied and what information or correction may be relevant.

What this rule is about

The source material defines the expression “tax position”. This is a general interpretive term used in the Scottish devolved tax system. It helps identify the full range of matters that may be relevant when looking at a person’s affairs for tax purposes.

The definition is deliberately wide. It is not limited to a tax bill that has already been issued or a return that has already been filed. It also includes possible future liabilities, amounts that may become payable or repayable, and procedural matters that affect liability.

In the devolved tax context, this can be relevant to taxes such as Land and Buildings Transaction Tax and Scottish Landfill Tax, because a person’s tax position may include more than the headline tax calculation on a transaction.

What the official source says

Section 120 of the Revenue Scotland and Tax Powers Act 2014 says that a person’s “tax position” means that person’s position, at any time and for any period, in relation to any devolved tax.

The definition specifically includes the person’s position regarding:

• past, present, and future liability to pay any devolved tax;
• penalties and other amounts that have been paid, or are or may become payable, by or to the person in connection with any devolved tax; and
• claims, elections, applications, and notices that have been made or given, or may be made or given, in connection with the person’s liability to pay any devolved tax.

The legislation also says that a reference to a “person” includes:

• an individual who has died; and
• a company that has ceased to exist.

What this means in practice

In practice, “tax position” is much wider than “how much tax is due”. If Revenue Scotland, a taxpayer, or an adviser is considering someone’s tax position, they may need to look at the whole picture.

That picture can include:

• whether tax was underpaid in the past;
• whether tax is due now;
• whether tax may become due in future because of later events;
• whether a penalty has arisen or might arise;
• whether an amount has been overpaid and may be repayable;
• whether a relief claim, election, or notice has been made correctly; and
• whether a claim, election, application, or notice could still be made and would affect liability.

This means you should not treat the term as referring only to a filed return or a completed transaction. A person’s tax position may still be affected by later amendments, claims, enquiries, penalties, or events that change the tax analysis.

The inclusion of deceased individuals and dissolved companies is also important. It shows that the concept does not end simply because the person is no longer alive or the company no longer exists. Their tax position may still matter for assessment, recovery, repayment, or administrative purposes, depending on the wider legal context.

How to analyse it

When asking what someone’s tax position is, it helps to work through the issue in stages.

• Identify the devolved tax involved. For property matters, that may be LBTT.
• Identify the relevant time and period. The definition applies “at any time” and for “any period”, so be clear about the date or period you are examining.
• Consider liabilities broadly. Look at past, current, and possible future tax liabilities.
• Check connected amounts. Ask whether penalties, interest, repayments, or other amounts paid or payable are part of the picture.
• Check procedural steps. Ask whether claims, elections, applications, or notices have been made, should have been made, or still may be made.
• Do not assume the matter ends because the person has died or the company has been dissolved. The legislation expressly includes those cases within the concept of a “person”.

This framework is useful because the statutory definition is not focused on one narrow issue. It is designed to capture a person’s full tax stance in relation to devolved taxes.

Example

Suppose a company entered into a land transaction that gave rise to LBTT. At first glance, you might think its tax position is simply the amount of LBTT shown on the return. But the statutory definition is wider.

The company’s tax position could also include:

• whether the original LBTT liability was calculated correctly;
• whether a relief claim was available or was made;
• whether a later event changes the amount due;
• whether any penalty is payable for an error or failure; and
• whether Revenue Scotland owes a repayment.

If the company has since ceased to exist, that does not stop the concept from applying. The legislation still treats a ceased company as a “person” for this purpose.

Why this can be difficult in practice

The definition is broad, which is useful but can also make it easy to overlook part of the analysis.

One difficulty is that people often think only in terms of tax due on a return. The legislation goes further. It includes future liabilities and procedural matters that may affect liability. That means a person’s tax position may remain open or changeable even where the immediate tax calculation seems settled.

Another difficulty is that the definition itself does not tell you the legal consequences in every context. It tells you what is included within a person’s tax position, but the practical effect will depend on the separate statutory provision that uses that term.

A further point is that claims, elections, applications, and notices can be highly technical. Whether one “may be made or given” can depend on time limits, statutory conditions, and the detailed rules for the devolved tax in question. The definition shows these matters are part of the tax position, but it does not itself decide whether a particular claim or election is valid.

Key takeaways

• “Tax position” is a wide concept, not just the amount of tax currently due.
• It includes liabilities, penalties, repayments, and procedural steps such as claims, elections, applications, and notices.
• The concept can still apply to a deceased individual or a company that has ceased to exist.

This page was last updated on 24 March 2026

Useful article? You may find it helpful to read the original guidance here: Guidance on Understanding ‘Tax Position’ in Relation to Devolved Taxes

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