What LBTT is
LBTT is a tax on buying land and buildings in Scotland. It replaced UK Stamp Duty Land Tax for Scottish property on 1 April 2015 and is collected by Revenue Scotland, not HMRC. It applies whether you buy with a mortgage or with cash, and whether the home is newly built or decades old.
You pay it on the price you pay for the property, which the law calls the chargeable consideration. On a normal purchase that is simply the agreed price. Gifts with no payment, and most transfers between spouses or civil partners when they separate, are not taxed.
Residential and non-residential property have different rates. This guide and the calculator cover homes. Shops, offices, farmland and mixed-use property use the non-residential rates.
The rates for 2026/27
LBTT is a slice tax, like Income Tax. The price is split into bands, and each rate applies only to the part of the price inside its band. Moving into a higher band never increases the tax on the slices below it.
| Part of the price | Rate |
|---|---|
| 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% |
These bands have not changed since April 2021, so the same price has paid the same LBTT for several years. The rates are set by the Scottish Parliament and can change at each Scottish Budget, usually announced in December or January.
A worked example
Here is the tax on a £280,000 home bought by someone moving house.
- First £145,000 at 0%£0
- Next £105,000 at 2%£145,001 to £250,000£2,100
- Last £30,000 at 5%£250,001 to £280,000£1,500
That is 1.29% of the price. At £400,000 the same buyer pays £13,350, because £75,000 of the price now falls in the 10% band. That jump is why the rate on the next pound you offer matters when you are negotiating: above £325,000, every extra £1,000 of price costs £100 in tax.
First-time buyer relief
First-time buyers get a larger 0% band. Instead of £145,000, the first £175,000 is tax-free. The rest of the bands are the same, so the relief is worth up to £600 (2% of £30,000).
| Price | Moving home | First-time buyer | Saving |
|---|---|---|---|
| £175,000 | £600 | £0 | £600 |
| £200,000 | £1,100 | £500 | £600 |
| £250,000 | £2,100 | £1,500 | £600 |
| £300,000 | £4,600 | £4,000 | £600 |
| £400,000 | £13,350 | £12,750 | £600 |
To qualify, you must:
- be buying your only or main home in Scotland;
- never have owned a home before, anywhere in the world, either on your own or jointly; and
- if buying with others, every buyer must also be a first-time buyer.
Unlike England, Scotland has no price cap on the relief. A first-time buyer paying £600,000 still saves £600. You claim it on the LBTT return, which your solicitor completes.
The Additional Dwelling Supplement
If you will own more than one home after the purchase, you usually pay the Additional Dwelling Supplement (ADS) on top of the normal LBTT. Since 5 December 2024 the supplement is 8% of the whole price, not just the part above a threshold.
- Normal LBTT2% on £55,000£1,100
- ADS at 8% of £200,000£16,000
ADS does not apply if the price is under £40,000. Above that, the 8% applies to the full price, so a £100,000 flat carries £8,000 of ADS even though no normal LBTT is due.
ADS is charged on the whole price
Because the supplement is a flat 8% of the price, it is far larger than the normal LBTT on most homes. On a £300,000 second home the ADS is £24,000, more than five times the £4,600 of normal LBTT.
Who pays ADS
ADS usually applies when, at the end of the day you buy, you own two or more homes. Common cases:
- buying a buy-to-let property or a holiday home;
- buying a new home before you have sold your old one;
- buying a home for a child to live in, if you are named on the title and already own your own home;
- buying jointly with someone who already owns a home and is keeping it.
Spouses, civil partners and cohabiting couples are treated as one unit. If your partner owns a home, you are treated as owning it too, even if only one of you is buying. Homes anywhere in the world count, but a share of a home worth less than £40,000 is ignored.
Companies and other non-individual buyers pay ADS on all residential purchases of £40,000 or more, whatever else they own.
Reclaiming ADS
If you buy your new main home before selling the old one, you pay ADS at first but can claim it back once you sell. You must sell your previous main home within 36 months of buying the new one.
- Day 1Buy your new home
Pay normal LBTT plus 8% ADS through your solicitor.
- Within 36 monthsSell your old main home
It must have been your main home at some point in the three years before you bought the new one.
- After the saleClaim the refund
Apply to Revenue Scotland, usually through your solicitor, within the time limit for repayment claims.
The refund is the ADS only; the normal LBTT stays paid. Revenue Scotland sets a time limit for the claim, so make it soon after the sale. If you sold your old main home before buying, ADS does not apply in the first place, as long as the new home replaces it.
LBTT at common prices
| Price | Moving home | First-time buyer | Second home (with ADS) |
|---|---|---|---|
| £150,000 | £100 | £0 | £12,100 |
| £200,000 | £1,100 | £500 | £17,100 |
| £250,000 | £2,100 | £1,500 | £22,100 |
| £300,000 | £4,600 | £4,000 | £28,600 |
| £350,000 | £8,350 | £7,750 | £36,350 |
| £400,000 | £13,350 | £12,750 | £45,350 |
| £500,000 | £23,350 | £22,750 | £63,350 |
| £750,000 | £48,350 | £47,750 | £108,350 |
| £1,000,000 | £78,350 | £77,750 | £158,350 |
The calculator above gives the exact figure for any price, along with the band-by-band workings your solicitor will use.
Scotland, England and Wales compared
Each nation now has its own property tax. Scotland is cheaper than England for lower-priced homes but more expensive for most homes above about £330,000, because the 10% band starts at £325,000 rather than £925,000.
| Price | Scotland (LBTT) | Wales (LTT) | England & NI (SDLT) |
|---|---|---|---|
| £200,000 | £1,100 | £0 | £1,500 |
| £250,000 | £2,100 | £1,500 | £2,500 |
| £300,000 | £4,600 | £4,500 | £5,000 |
| £400,000 | £13,350 | £10,500 | £10,000 |
| £500,000 | £23,350 | £18,000 | £15,000 |
| £750,000 | £48,350 | £36,750 | £27,500 |
For second homes the gap is wider still. A £300,000 buy-to-let costs £28,600 in Scotland, £20,000 in England and £19,950 in Wales.
Filing and paying
Your solicitor completes an LBTT return and sends it to Revenue Scotland with the payment within 30 days of the date of entry, which is usually the settlement date when you get the keys. In practice, solicitors ask you for the money before settlement and pay it on the day, because the title cannot be registered with the Registers of Scotland until the return is filed.
A return is needed for most purchases of £40,000 or more, even when no tax is due. Late returns and late payments attract penalties and interest.
Budget for it alongside your deposit
LBTT cannot normally be added to your mortgage. Plan to have the full amount in cash at settlement, together with your deposit, legal fees and any Home Report or survey costs.
Paying no more than you owe
There are no loopholes, but a few legitimate points can keep the bill right:
- Furniture and fittings. Items that are not part of the building, such as curtains, free-standing white goods and furniture, are not taxed. If they are included in the price, they can be listed separately at a fair value. Overstating them is tax evasion.
- Thresholds. Because each rate applies only to its slice, there are no cliff edges in LBTT. But an offer just over £325,000 pays 10% on the excess, so negotiating down to the threshold saves 10p in every pound.
- Sell before you buy. If you can, selling your old home first avoids paying ADS and waiting for the refund.
- Check first-time buyer status. If every buyer qualifies, make sure your solicitor claims the relief.
Special cases
New-build incentives. If a developer pays your LBTT as an incentive, the tax is still worked out on the price you pay. Part-exchange deals have their own rules.
Shared equity. Under Scottish Government shared equity schemes you usually pay LBTT on the share you buy. Your solicitor will confirm how the scheme is treated.
Buying several homes at once. Different rules can apply when several dwellings are bought in one transaction. Get specialist advice.
Inherited shares. Inheriting part of a home can mean you count as owning another home for ADS. Special rules can ignore some small or recently inherited shares, so tell your solicitor about any inheritance.
Leases. Residential leases in Scotland are rare, and most homes are bought outright. Non-residential leases have their own LBTT rules.
How LBTT has changed
- April 2015LBTT replaces Stamp Duty in Scotland
Devolved under the Scotland Act 2012 and run by Revenue Scotland.
- April 2016ADS introduced at 3%
Matching the surcharge introduced in England at the same time.
- June 2018First-time buyer relief
The 0% band rises to £175,000 for first-time buyers.
- January 2019ADS rises to 4%
- December 2022ADS rises to 6%
- December 2024ADS rises to 8%
The highest second-home surcharge in the UK.
Effective rates
Because LBTT is charged in slices, the share of the price you pay in tax rises gradually. The effective rate is the total LBTT divided by the price:
| Price | LBTT | Effective rate |
|---|---|---|
| £200,000 | £1,100 | 0.55% |
| £300,000 | £4,600 | 1.53% |
| £400,000 | £13,350 | 3.34% |
| £500,000 | £23,350 | 4.67% |
| £750,000 | £48,350 | 6.45% |
| £1,000,000 | £78,350 | 7.84% |
Above £325,000 the effective rate climbs quickly because each extra pound is taxed at 10%. That matters when you are stretching to a bigger home: moving from £350,000 to £400,000 adds £5,000 of LBTT on top of the extra £50,000.
The full cost of buying in Scotland
LBTT is one of several costs when you buy a home in Scotland. Budget for:
- Legal fees for your solicitor, who also handles the missives and settlement.
- Registration dues paid to the Registers of Scotland to register your title, which rise with the price.
- Mortgage fees, such as an arrangement fee and a valuation fee.
- Surveys beyond the Home Report, if you want more detail. The seller pays for the Home Report.
- Removals and furnishing, plus buildings insurance from the date of entry.
Our moving house budget calculator brings these together with your LBTT and deposit.