SDLT Notification: Lease Continuation by Tacit Relocation Example 3 (Scotland

Scottish Leases, Tacit Relocation and the Move from SDLT to LBTT

If a Scottish lease continues automatically by tacit relocation, the main tax issue is whether the relevant event happened before or after April 2015. From April 2015, SDLT stopped applying to land transactions in Scotland, so post-April 2015 Scottish lease matters fall under LBTT instead. Archived SDLT guidance may still help for older transactions, but it should not be used as the main authority for later Scottish cases.

• Tacit relocation means a Scottish lease can continue automatically after its fixed term ends unless properly terminated.
• For tax purposes, the first questions are where the property is and when the relevant lease event happened.
• If the Scottish land transaction occurred from April 2015 onwards, the correct tax regime is LBTT, not SDLT.
• Archived SDLT material may still be relevant for Scottish lease transactions that happened before April 2015.
• Cases where a lease started before April 2015 but continued, was varied, or was renewed afterwards may need careful review of transitional rules.

Scroll down for the full analysis.

SDLT and Scottish leases: tacit relocation after April 2015

This page is about a very narrow point: what happens for Stamp Duty Land Tax if a Scottish lease continues by tacit relocation. The official source page is an archived example page, and it mainly signals an important boundary in time. From April 2015, SDLT stopped applying to land transactions in Scotland. After that point, Scottish lease transactions fall under Land and Buildings Transaction Tax instead.

What this rule is about

Tacit relocation is a Scottish property law concept. In broad terms, it describes a lease continuing automatically after its original term ends, unless one of the parties brings it to an end properly. For tax purposes, the key question is which tax regime applies to that continued occupation and whether any notification or return is needed.

The source material does not set out the detailed SDLT treatment itself. What it does make clear is that the page is archived because, from April 2015, SDLT no longer applies to Scottish land transactions. That matters because a reader must first identify whether the lease event they are looking at happened before or after the changeover.

What the official source says

The official source states that the page is archived and that, from April 2015, SDLT no longer applies to land transactions in Scotland. Instead, those transactions are subject to Land and Buildings Transaction Tax.

The practical legal point is therefore a jurisdiction and timing point:

• if the relevant land transaction is in Scotland and occurs from April 2015 onwards, SDLT is not the charging regime to use;
• for Scottish lease matters after that date, the relevant tax is LBTT, not SDLT;
• older SDLT manual material on Scottish leases may still have historical value for pre-April 2015 transactions, but it does not govern post-switch Scottish transactions.

What this means in practice

If you are looking at a Scottish lease that has continued automatically, the first question is not whether tacit relocation has occurred in Scots law. The first tax question is whether the relevant event falls within the SDLT era or the LBTT era.

In practice, that means:

• for pre-April 2015 Scottish lease transactions, archived SDLT material may still be relevant;
• for post-April 2015 Scottish lease transactions, you should not rely on SDLT guidance as the operative tax regime;
• if a lease began under SDLT but continued, varied, or renewed after the Scottish switch to LBTT, the analysis may require careful attention to transitional rules and to the precise legal character of what happened.

The source provided does not include those transitional rules or the underlying example, so it would be unsafe to state more than that from this material alone.

How to analyse it

A sensible way to approach this issue is to work through the following questions:

• Is the property in Scotland?
• What exactly happened to the lease: did it simply continue automatically, was there a formal renewal, or was there a variation?
• When did the relevant tax event occur?
• Is the transaction wholly before April 2015, wholly after it, or straddling the change in regime?
• Are you looking for the SDLT position historically, or the current tax treatment?

If the answer is that the relevant Scottish land transaction occurred from April 2015 onwards, the official source indicates that LBTT is the correct regime, not SDLT.

Example

Illustration: a tenant in Scotland had a fixed-term lease that ended after April 2015, but the tenant remained in occupation and the lease continued automatically under Scots law. A reader might find an old HMRC SDLT manual page on tacit relocation and assume SDLT still applies. The archived source warns against that assumption. For a Scottish land transaction from April 2015 onwards, the starting point is LBTT, not SDLT.

Why this can be difficult in practice

This area can be awkward because tacit relocation is a Scots law concept, while the tax question depends not just on property law but also on timing and tax jurisdiction. Problems often arise where:

• an old lease started before April 2015 but continued afterwards;
• there is uncertainty over whether what happened was a continuation, a renewal, or a new lease for tax purposes;
• someone relies on archived SDLT material without checking whether the Scottish LBTT regime has replaced it.

The source text supplied here is very limited. It does not reproduce the example or any detailed rule on notification. So the only safe conclusion from this source alone is the regime change: post-April 2015 Scottish land transactions are outside SDLT and within LBTT.

Key takeaways

• The official page is archived because SDLT stopped applying to Scottish land transactions from April 2015.
• For Scottish leases continuing by tacit relocation after that date, the relevant tax regime is LBTT, not SDLT.
• The critical first step is to identify the location of the property and the date of the relevant lease event.

This page was last updated on 24 March 2026

Useful article? You may find it helpful to read the original guidance here: SDLT Notification: Lease Continuation by Tacit Relocation Example 3 (Scotland

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