Guidance on Definitions of ‘Premises’ and ‘Business Premises’ Including Transport
What counts as premises and business premises for Revenue Scotland inspections
Revenue Scotland’s inspection powers under the Revenue Scotland and Tax Powers Act 2014 can apply to a wide range of places, not just buildings. “Premises” can include land, structures and some vehicles, but they are only “business premises” if Revenue Scotland reasonably believes they are used in carrying on a business. If only part of a place is used for business, only that part is within scope.
- “Premises” is defined widely and can include any building, structure, land or means of transport.
- “Business premises” means premises Revenue Scotland has reason to believe are used in connection with a business carried on by or for a person.
- If a property, yard, vehicle or other place is mixed-use, only the part actually used for the business counts as business premises.
- Where more than one business uses the same place, the inspection power depends on whose tax position is being checked.
- A vehicle used as part of business operations, such as a van carrying tools or stock, may be business premises, but a car used only for commuting is outside these powers.
Scroll down for the full analysis.
Read the original guidance here:
Guidance on Definitions of ‘Premises’ and ‘Business Premises’ Including Transport
What counts as “premises” and “business premises” for Revenue Scotland inspection powers
This page explains how Revenue Scotland uses the terms “premises” and “business premises” when carrying out inspections under the Revenue Scotland and Tax Powers Act 2014. The point matters because those terms define where Revenue Scotland may be able to enter and inspect when checking a person’s tax position. The official guidance also makes clear that the concept can extend beyond buildings and land to vehicles and other means of transport, but only in some situations.
What this rule is about
Under the inspection powers in sections 141 and 142 of the Revenue Scotland and Tax Powers Act 2014, Revenue Scotland may inspect “business premises” in certain circumstances. To understand the scope of that power, you first need to know what counts as “premises”, and then whether those premises are being used in connection with a business.
The issue is not just about shops, offices, warehouses, or factories. The official guidance says that premises can include buildings, structures, land, and means of transport. It also says that only part of a place may be business premises if only that part is used for the business.
What the official source says
The guidance says that “business premises” are premises that Revenue Scotland has reason to believe are used in connection with the carrying on of a business by or on behalf of a person. If only part of the premises is used for that purpose, only that part is treated as business premises.
It also says that premises may be used for more than one business. In that situation, the parts Revenue Scotland may enter depend on whose tax position is being checked.
For these purposes, “premises” include:
- any building or structure
- any land
- any means of transport
The building, structure, land, or means of transport do not need to be on land owned by the same person, and may be anywhere.
On vehicles and other transport, the guidance draws an important distinction. A means of transport might itself be business premises if it is used in connection with the business. For example, a vehicle used in carrying on the business may be both a business asset and business premises. But a car used only to take the owner or an employee to and from work is not treated as business premises or as a business asset for these inspection powers. The guidance says Revenue Scotland cannot enter or inspect such a car, or obtain or record information about it, under these powers.
What this means in practice
The practical question is not simply “is this place connected to a business?” It is more specific:
- Is it “premises” within the wide meaning used by the legislation and guidance?
- Is Revenue Scotland entitled to believe it is used in connection with carrying on a business?
- If the place is mixed-use, which part is actually used for the business?
- If there is more than one business operating there, which business is relevant to the tax check?
This matters because inspection powers are not unlimited. The guidance does not say that every place associated with a business can automatically be entered. It says the relevant premises must be used in connection with the carrying on of the business, and the scope of any inspection depends on the tax position being checked.
It also matters for mixed private and business use. If a room, area, vehicle, or structure is only partly used for business, the business use does not necessarily turn the whole thing into business premises. The official guidance points instead to the part that is actually used in connection with the business.
Vehicles are a good example. A van used to transport tools, stock, or equipment as part of the business may fall within the concept of business premises. But an ordinary commuting car does not, merely because the driver owns or works in the business.
How to analyse it
A sensible way to analyse the issue is to work through these questions.
Identify the place or item in question.
Is it a building, a structure, land, or a means of transport? The official guidance treats all of these as capable of being “premises”.
Ask how it is used.
The key test in the guidance is whether Revenue Scotland has reason to believe the premises are used in connection with carrying on a business by or on behalf of a person.
Check whether only part is used for business.
If only part is used for the business, the guidance says only that part is business premises. This is especially important for homes, mixed-use buildings, yards, storage space, and vehicles with both business and private use.
Consider whether more than one business uses the same place.
If so, the relevant area depends on whose tax position is under review. Shared premises do not automatically open up every part to inspection in relation to every taxpayer.
For vehicles, distinguish business use from ordinary commuting.
A vehicle used in carrying on the business may be within scope. A car used only to get the owner or employee to and from work is outside scope under the guidance.
Example
Illustration: a landscaping business operates from a yard with a small office, an equipment shed, and two vehicles. One vehicle is a van used to carry tools and materials to customer sites. The other is the owner’s private car, used only to drive from home to the yard and back.
On the official guidance, the office, shed, and yard are capable of being business premises if they are used in connection with the business. The van may also be business premises, because it is used in carrying on the business. Revenue Scotland might inspect it if that is needed for the tax check, and might ask for it to be opened if there is reason to think its contents are relevant.
The private car is different. If it is used only for commuting, the guidance says it is neither business premises nor a business asset for these purposes, and Revenue Scotland cannot inspect it under these powers.
Why this can be difficult in practice
The hard cases are usually mixed-use cases.
One difficulty is deciding when a place is used “in connection with” carrying on a business. That phrase is broad, but it still requires a real business link. The guidance does not turn every place touched by the business into business premises.
Another difficulty is partial use. A place may be partly private and partly business. The guidance says only the business part is business premises, but in practice that may require a factual judgment about which areas are genuinely used for the business and which are not.
Vehicles can also be fact-sensitive. A vehicle used to transport goods, tools, records, or equipment as part of business operations may be within scope. But if a vehicle is used only for commuting, it is outside scope. Some cases may sit between those two positions, especially where there is both business and private use.
The guidance also notes that a person’s home can sometimes fall within the definition of business premises, but that depends on separate guidance about when a home is used in connection with a business. That is another area where the facts matter.
Key takeaways
- For these inspection powers, “premises” is a wide term and can include buildings, structures, land, and means of transport.
- Premises are only “business premises” if Revenue Scotland has reason to believe they are used in connection with carrying on a business by or on behalf of the person in question.
- If only part of a place is used for the business, only that part is business premises; a car used only for commuting is not within scope.
This page was last updated on 24 March 2026
Useful article? You may find it helpful to read the original guidance here: Guidance on Definitions of ‘Premises’ and ‘Business Premises’ Including Transport
View all LBTT Guidance Pages Here
Search Land Tax Advice with Google
