Guidance on LBTT Returns for Contingent or Unascertained Considerations

LBTT where the final purchase price becomes clear later

If part of the price for a land transaction was contingent, uncertain or not yet fixed when the original LBTT return was filed, the buyer may need to revisit the tax position once the amount becomes clear. A further return may be needed if more tax is due, while a repayment claim may be possible if too much tax was paid originally.

• A relevant event happens when a contingency occurs or fails, or when an uncertain amount becomes fixed and known.
• If that event means extra LBTT is due, or makes the transaction notifiable when it was not before, the buyer must file a further return within 30 days.
• Any extra LBTT is worked out using the rates and bands that applied on the original effective date, not the rates in force when the later event happens.
• The later return should be linked to the original return, show the full consideration now known, and include only the additional LBTT payable at that stage.
• If the later event reduces the taxable consideration, the buyer should claim a repayment instead of filing a further return: by amending the return within 12 months, or by a section 107 claim within five years if that window has closed.
• Care is needed over timing, record-keeping and return completion, as late filing, late payment or inaccuracies can lead to penalties and interest.

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LBTT when contingent or unascertained consideration later becomes known

This page explains what happens for Land and Buildings Transaction Tax when the price for a land transaction was not fully fixed at the start. In some transactions, part of the consideration depends on a future event, or the amount is uncertain or not yet known. When that later changes, a further LBTT return may be required, and the tax position may need to be updated.

What this rule is about

LBTT is normally reported by reference to the chargeable consideration for the transaction. That is straightforward where the full price is known on the effective date. It is less straightforward where some of the consideration is contingent, uncertain or unascertained.

The official guidance deals with what happens later, once the missing piece becomes clear. There are two broad situations:

• Contingent consideration: a payment depends on a future event happening, or not happening.
• Uncertain or unascertained consideration: the amount is not yet fixed, but later becomes known.

Once the position becomes clear, the buyer may need to file a further return and pay more LBTT. In other cases, the buyer may instead be entitled to reclaim overpaid tax.

What the official source says

The Revenue Scotland guidance identifies the triggering event as follows:

• For contingent consideration, the relevant event is when the contingency occurs, or when it becomes clear that it will not occur.
• For uncertain or unascertained consideration, the relevant event is when the amount becomes ascertained.

If that event means that:

• the transaction becomes notifiable when it was not notifiable before, or
• additional LBTT becomes payable, or
• LBTT becomes payable when none was payable before,

the buyer must make a further return to Revenue Scotland within 30 days of the event. For that further return, the date of the event is treated as the relevant date.

The tax due on that further return is not recalculated using rates and bands in force at the later event date. Instead, it is calculated using the rates and bands that applied at the effective date of the original transaction.

The guidance also explains how the return should be completed in practice:

• the later return should be linked to the earlier return;
• the total consideration should be updated to show the amount now actually known, including both the amount already returned and the further amount now established; and
• the total tax payable field should be amended to show only the additional LBTT now due, if extra tax has become payable and has not already been paid.

When completing the return, the buyer must answer yes to linked transactions and include the return reference for the original return together with the consideration shown in that original return.

The guidance then deals separately with the opposite outcome. If less tax is payable because a contingent amount falls away, or because the uncertain or unascertained amount turns out to be lower, the buyer may claim a repayment.

If that happens within the normal 12-month amendment window, the claim must be made by amending the LBTT return. If it happens after that amendment period has ended, the claim must be made under section 107 of the Revenue Scotland and Tax Powers Act 2014, and no later than five years after the date the original return was required to be made.

What this means in practice

The key practical point is that LBTT does not necessarily end with the original return if part of the consideration was not finally known.

You need to revisit the transaction when the uncertainty is resolved. At that point, ask two separate questions:

• Has the later event increased the amount on which LBTT should be paid?
• Or has it reduced the amount that should ultimately have borne LBTT?

If the answer is that more LBTT is due, the buyer may have to file a further return within 30 days. If the answer is that too much LBTT was paid originally, the route is a repayment claim rather than a further return.

The rates and bands point is important. Even though the later event may happen months or years after completion, the tax is worked out by reference to the rates and bands in force on the original effective date. So the later return updates the original transaction; it does not treat the later event as a fresh land transaction taxed under current rates.

The guidance also shows that return mechanics matter. Revenue Scotland expects the later return to be linked back to the original one, and the figures entered in the return have to reflect the overall consideration now known, while the tax box should show only the additional amount now payable.

There are also compliance consequences. Late filing can trigger penalties. Inaccuracies can trigger penalties. Late payment can trigger penalties and interest. The buyer must also keep records sufficient to support a correct and complete return.

How to analyse it

A sensible way to approach these cases is to work through the following questions.

• What part of the consideration was contingent, uncertain or unascertained at the time of the original return?
• What later event has now happened? Has the contingency occurred, failed, or has the amount now become fixed?
• Does that event increase the taxable consideration, reduce it, or simply confirm what was already returned?
• If it increases the tax, does the increase make the transaction notifiable or cause additional LBTT to become payable?
• If so, has a further return been filed within 30 days of the event?
• When calculating the tax effect, have you used the rates and bands from the original effective date rather than current rates?
• If the event reduces the tax, are you still within the 12-month amendment window, or is a section 107 claim needed instead?
• Is the claim still within the five-year time limit for claims made outside the amendment window?
• Do the records clearly show the original position, the later event, and how the revised tax figure has been calculated?

This framework helps separate three issues that are easy to mix up: whether a further return is needed, whether the buyer is instead entitled to a repayment, and which time limit applies.

Example

Suppose a buyer acquires land for a fixed sum plus an extra amount payable only if a specified planning permission is obtained within three years.

If the extra amount is a known figure, it is part of the chargeable consideration for LBTT purposes from the outset, even though payment depends on the future event. The original return therefore reflects both the fixed amount and the contingent amount.

If the planning permission is never obtained, the contingent amount falls away. In that case, the guidance says the buyer does not file a further return just because the contingent amount has ceased to be payable. Instead, the buyer may claim repayment of the LBTT overpaid on that amount.

If this happens after the 12-month amendment period has expired, the buyer cannot simply amend the return. The claim must instead be made under section 107 of the Revenue Scotland and Tax Powers Act 2014, subject to the five-year limit referred to in the guidance.

Why this can be difficult in practice

The main difficulty is that the later event does not always fit neatly into a simple category. It may not be obvious exactly when a contingency has become impossible, or exactly when an uncertain amount has become sufficiently fixed to count as ascertained. That timing matters because it affects the 30-day filing deadline for a further return and can affect whether an amendment is still possible.

Another practical difficulty is distinguishing between the total consideration now known and the extra tax now payable. The guidance expects the return to show the updated total consideration, but the tax field should reflect only the additional amount due at that stage. If those figures are confused, the return may be completed incorrectly.

Repayment cases also create timing issues. The route differs depending on whether the event happens within the amendment window or after it. Missing that distinction can lead to the wrong process being used.

Finally, the guidance refers to linked transactions for return-completion purposes. That is an administrative instruction for linking the later return to the original one. Readers should be careful not to assume that this is the same as the wider substantive LBTT rules on linked transactions in all contexts.

Key takeaways

• If contingent, uncertain or unascertained consideration later becomes fixed, you may need to revisit the original LBTT position.
• Where more LBTT becomes due, a further return is required within 30 days of the relevant event, using the original effective-date rates and bands.
• Where less LBTT is ultimately due, the remedy is a repayment claim, either by amendment within 12 months or by a section 107 claim within the longer statutory time limit.

This page was last updated on 24 March 2026

Useful article? You may find it helpful to read the original guidance here: Guidance on LBTT Returns for Contingent or Unascertained Considerations

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