LBTT Explained: Scotland Property Tax (2026/27)

LBTT explained: Scotland property tax (2026/27)

Land and Buildings Transaction Tax (LBTT) is the tax you pay when you buy property or land in Scotland. It replaced Stamp Duty Land Tax (SDLT) in 2015, and it works on progressive bands, so each rate applies only to the slice of the price within that band.

By the Vortex Finance broker desk · Reviewed for accuracy · 6 min read

What is LBTT?

LBTT is Scotland’s equivalent of stamp duty, administered by Revenue Scotland rather than HMRC. If you buy a home, a buy-to-let or commercial property in Scotland, you pay LBTT instead of the SDLT charged in England and Northern Ireland. Like SDLT, it is charged progressively: you pay a different rate on each portion of the price, not a single rate on the whole figure.

Residential LBTT bands (2026/27)

For a standard residential purchase, the rates are tiered as follows:

Residential LBTT bands

0% on the portion up to £145,000
2% on £145,001 to £250,000
5% on £250,001 to £325,000
10% on £325,001 to £750,000
12% on the portion above £750,000

First-time buyers in Scotland benefit from a separate relief that raises the nil-rate threshold, which is not reflected in the simple bands above.

The Additional Dwelling Supplement (ADS)

If you are buying a second home, a buy-to-let, or purchasing through a limited company, you also pay the Additional Dwelling Supplement. Since 5 December 2024, ADS is 8% of the whole purchase price — not just the slice above a threshold. It is charged on top of the standard LBTT, so it materially changes the maths on any investment purchase.

Worked example: a £300,000 purchase

Take a £300,000 property. The progressive LBTT is calculated band by band:

LBTT on £300,000

0% on the first £145,000 = £0
2% on the next £105,000 (£145,001–£250,000) = £2,100
5% on the next £50,000 (£250,001–£300,000) = £2,500
Total LBTT = £4,600

If that same £300,000 property is a second home or buy-to-let, add ADS at 8% of the whole price: 8% × £300,000 = £24,000. The total tax payable then becomes £4,600 + £24,000 = £28,600. That ADS line is often the single biggest cost an investor underestimates, so model it before you offer.

This is general information, not tax advice — confirm figures with your accountant or conveyancer. Reliefs, first-time-buyer rules, mixed-use, multiple-dwellings and non-resident treatment can all change your liability, and Revenue Scotland sets the definitive position.

Where Vortex Finance fits

We arrange the finance; you confirm the tax. Once you know your LBTT and ADS position, we shop the market for the lending around the purchase — whether that is a Scottish buy-to-let mortgage, a commercial mortgage, a short-term bridging loan to move at speed, or development finance for a build. Asking won’t affect your credit score.

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