Land and Buildings Transaction Tax (LBTT) Residential

Residential

The Scotland Act 2012 devolved Stamp Duty Land Tax to the Scottish Parliament from April 2015. Following devolution, Land and Buildings Transaction Tax (LBTT) replaced Stamp Duty Land Tax.

The Scottish Parliament sets the rate of tax on residential purchases of land and buildings. LBTT is a fully devolved tax collected by Revenue Scotland.

Additional Dwelling Supplement (ADS)

In April 2016, the Scottish Government introduced the LBTT Additional Dwelling Supplement (ADS) for additional properties such as second homes or buy-to-let.

The ADS is charged at 3% of the total purchase price of additional properties priced at £40,000 and above.

Latest forecasts

On 12 December 2018, we produced updated forecasts for Residential LBTT.

Residential LBTT receipts forecast (excluding ADS) – December 2018

£ million 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24
May 2018 258 312 342 373 405 438 473
Prices   -34 -21 -20 -22 -25 -29
Transactions   -13 -26 -30 -35 -41 -49
Fiscal drag   0 1 1 1 1 2
FTB recosting   0 0 0 0 1 1
Other   2 1 1 1 2 2
December 2018 pre-measures 258 267 297 326 351 375 400
ADS Policy change   0 -2 -1 -1 -2 -2
December 2018 post-measures 258 267 296 324 349 373 398
Total change   -45 -46 -49 -56 -65 -75

Source: Scottish Fiscal Commission (2018) Scotland's Economic & Fiscal Forecasts December 2018

 

ADS forecast – December 2018

£ million 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24
May 2018 95 97 100 104 108 112 116
House prices   -1 0 0 0 0 0
Transactions   -5 -8 -8 -9 -10 -12
Repayment Rate   0 2 2 2 2 2
Other   2 0 0 0 -1 -1
December 2018 pre-measures 95 92 94 97 100 103 106
Policy changes   2 27 26 27 27 28
December 2018 post-measures 95 94 122 123 127 130 134
Total change    -2 22 19 19 19 18

Source: Scottish Fiscal Commission (2018) Scotland's Economic & Fiscal Forecasts December 2018

Our report Scotland’s Economic and Fiscal Forecasts contains further information on the methodology used to forecast residential LBTT.

Supporting information

Scottish Fiscal Commission (2018) Scotland's Economic and Fiscal Forecasts December 2018

Scottish Fiscal Commission (2018) Scotland’s Economic and Fiscal Forecasts May 2018

Scottish Fiscal Commission (2017) Scotland’s Economic and Fiscal Forecasts December 2017

Scottish Fiscal Commission (2016) Current Approach to Forecasting

Revenue Scotland LBTT page

Scottish Government page on LBTT

UK Government page on Scottish lands and buildings transactions

Revenue Scotland LBTT tax statistics

OBR Scottish tax forecasts