Revenue Scotland LBTT: Guide to Completing Paper LBTT Return Forms for Manual Submissions in Scotland

Paper LBTT Return Forms

This page provides information about paper Land and Buildings Transaction Tax (LBTT) return forms for manual submissions to Revenue Scotland. It outlines the process and requirements for completing these forms.

• Details the purpose of LBTT return forms for property transactions.
• Explains the manual submission process for these forms.
• Highlights the importance of accurate form completion.
• Provides links to download the necessary forms.
• Offers guidance on where to send completed forms.

Understanding Land and Buildings Transaction Tax (LBTT) in Scotland

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 from 1 April 2015. This article aims to provide a comprehensive overview of LBTT, including its purpose, how it is calculated, and the process of filing returns. For more detailed information, you can visit the official Revenue Scotland LBTT page.

What is LBTT?

LBTT is a tax levied on the purchase of residential and non-residential property and land in Scotland. It is designed to be progressive, meaning that the amount of tax paid is based on the price of the property or land. The tax applies to both freehold and leasehold transactions.

Why was LBTT Introduced?

LBTT was introduced to replace the Stamp Duty Land Tax (SDLT) in Scotland. The Scottish Government aimed to create a fairer and more efficient tax system that better reflects the property market in Scotland. The progressive nature of LBTT means that those purchasing higher-value properties pay a higher rate of tax, while those buying lower-value properties pay less.

How is LBTT Calculated?

LBTT is calculated based on the purchase price of the property or land. The tax is structured in bands, with different rates applied to different portions of the purchase price. This means that the tax rate increases with the value of the property or land.

Residential Property Rates

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

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

• 0% on the first £145,000 = £0
• 2% on the next £105,000 (£145,001 to £250,000) = £2,100
• 5% on the remaining £50,000 (£250,001 to £300,000) = £2,500

Total LBTT = £0 + £2,100 + £2,500 = £4,600

Non-Residential Property Rates

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

For non-residential leases, LBTT is calculated differently, taking into account the net present value (NPV) of the rent payable over the term of the lease.

Filing LBTT Returns

When you purchase a property or land in Scotland, you are required to submit an LBTT return to Revenue Scotland. This applies even if no tax is due. The return must be submitted and any tax due paid within 30 days of the effective date of the transaction, which is usually the date of completion.

How to File an LBTT Return

LBTT returns can be filed online through the Revenue Scotland website. You will need to provide details of the transaction, including the purchase price, the date of the transaction, and the property address. You can also file a paper return if necessary. For more information on paper LBTT return forms, visit the Revenue Scotland paper LBTT forms page.

Amending an LBTT Return

If you need to amend an LBTT return, you can do so within 12 months of the filing date. Amendments can be made online or by submitting a paper amendment form. Common reasons for amending a return include correcting errors or updating information if the transaction details change.

Additional Dwelling Supplement (ADS)

The Additional Dwelling Supplement (ADS) is an additional tax applied to the purchase of additional residential properties, such as second homes or buy-to-let properties. The ADS rate is currently 4% of the total purchase price and is payable in addition to the standard LBTT rates.

For example, if you purchase a second home for £200,000, the LBTT would be calculated as follows:

• 0% on the first £145,000 = £0
• 2% on the next £55,000 (£145,001 to £200,000) = £1,100
• ADS: 4% of £200,000 = £8,000

Total LBTT including ADS = £0 + £1,100 + £8,000 = £9,100

Exemptions and Reliefs

There are certain exemptions and reliefs available for LBTT. These can reduce the amount of tax payable or, in some cases, eliminate it entirely. Some common exemptions and reliefs include:

• First-time buyer relief: Reduces the amount of LBTT payable for first-time buyers purchasing a property up to £175,000.
• Charity relief: Available for transactions involving charities, reducing or eliminating LBTT.
• Group relief: Applies to transactions between companies within the same group, potentially reducing LBTT liability.

For a full list of exemptions and reliefs, visit the Revenue Scotland LBTT page.

Conclusion

Understanding LBTT is essential for anyone involved in property transactions in Scotland. By knowing the rates, how to file returns, and the available exemptions and reliefs, you can ensure compliance and potentially reduce your tax liability. For more detailed guidance, including how to file returns and access paper forms, visit the Revenue Scotland LBTT page.

Useful article? You may find it helpful to read the original guidance here: Revenue Scotland LBTT: Guide to Completing Paper LBTT Return Forms for Manual Submissions in Scotland

View all LBTT Guidance Pages Here