Revenue Scotland LBTT: Guide to Completing the ‘About the Calculation’ Section for Online LBTT Returns

About the Calculation

This section provides guidance on completing the ‘About the Calculation’ part of the online Land and Buildings Transaction Tax (LBTT) return. It outlines the necessary steps and information required to ensure accurate submission.

• Understand the purpose of the ‘About the Calculation’ section in the LBTT return.
• Learn the steps needed to complete this section accurately.
• Ensure all relevant information is included for correct tax calculation.
• Access additional resources and support if needed.

Understanding the Land and Buildings Transaction Tax (LBTT) in Scotland

The Land and Buildings Transaction Tax (LBTT) is a tax applied to residential and commercial land and buildings transactions in Scotland. It replaced the UK Stamp Duty Land Tax (SDLT) in Scotland on 1 April 2015. This article will guide you through the key aspects of LBTT, including how it is calculated, who is liable, and how to complete an LBTT return.

What is LBTT?

LBTT is a tax that buyers pay when they purchase land or buildings in Scotland. It applies to both residential and non-residential transactions. The tax is progressive, meaning that the rate increases with the value of the property.

Residential Transactions

For residential properties, LBTT is calculated based on the purchase price. The rates are tiered, meaning different portions of the price are taxed at different rates. For example:

• Up to £145,000: 0%
• £145,001 to £250,000: 2%
• £250,001 to £325,000: 5%
• £325,001 to £750,000: 10%
• Over £750,000: 12%

These rates are subject to change, so it’s important to check the latest rates on the Revenue Scotland website.

Non-Residential Transactions

For non-residential properties, the LBTT rates are as follows:

• Up to £150,000: 0%
• £150,001 to £250,000: 1%
• Over £250,000: 5%

Again, these rates can change, so it’s advisable to verify the current rates on the Revenue Scotland website.

Who Pays LBTT?

LBTT is generally paid by the buyer of the property. If you are purchasing a property in Scotland, you are responsible for ensuring that the LBTT is calculated correctly and paid to Revenue Scotland. This is typically done by your solicitor or conveyancer as part of the purchase process.

How to Calculate LBTT

Calculating LBTT involves applying the appropriate tax rates to the purchase price of the property. The tax is calculated on a sliding scale, with different portions of the price taxed at different rates.

For example, if you are buying a residential property for £300,000, the LBTT would be calculated as follows:

• The first £145,000 is taxed at 0%, so no tax is due on this portion.
• The next £105,000 (from £145,001 to £250,000) is taxed at 2%, resulting in £2,100.
• The remaining £50,000 (from £250,001 to £300,000) is taxed at 5%, resulting in £2,500.

The total LBTT due would be £4,600.

Completing an LBTT Return

Once the LBTT has been calculated, you need to complete an LBTT return and submit it to Revenue Scotland. This can be done online through the Revenue Scotland website. The return must be submitted, and the tax paid, within 30 days of the effective date of the transaction, which is usually the date of completion.

Steps to Complete an LBTT Return

1. Visit the Revenue Scotland website.
2. Log in or create an account if you do not already have one.
3. Navigate to the LBTT section and select the option to submit a new return.
4. Enter the details of the transaction, including the purchase price and the date of completion.
5. Calculate the LBTT due using the online calculator provided.
6. Submit the return and make the payment.

It is important to ensure that all the information you provide is accurate to avoid any penalties or interest charges.

Amending an LBTT Return

If you discover an error in your LBTT return after it has been submitted, you can amend it. Amendments can be made online through the Revenue Scotland website. You have 12 months from the filing date to make any amendments.

Steps to Amend an LBTT Return

1. Log in to your account on the Revenue Scotland website.
2. Locate the return you wish to amend and select the option to make an amendment.
3. Update the necessary details and resubmit the return.

Once the amendment is processed, any additional tax due must be paid, or any overpayment will be refunded.

Conclusion

The Land and Buildings Transaction Tax is a significant consideration for anyone purchasing property in Scotland. Understanding how it is calculated and ensuring that returns are completed accurately and on time is essential to avoid any issues. For more detailed information and guidance, visit the Revenue Scotland website.

By staying informed and following the correct procedures, you can ensure a smooth property transaction process in Scotland.

Useful article? You may find it helpful to read the original guidance here: Revenue Scotland LBTT: Guide to Completing the ‘About the Calculation’ Section for Online LBTT Returns

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