LBTT Explained: What You'll Pay to Buy a Home in Scotland

What LBTT is and how it's worked out

Land and Buildings Transaction Tax replaced Stamp Duty Land Tax in Scotland on 1 April 2015. It's collected by Revenue Scotland rather than HMRC, it's set at Holyrood rather than Westminster, and the buyer pays it. If you're buying in Scotland, stamp duty no longer applies to you at all.

It works in slices, the same way income tax does. Each rate applies only to the part of the price that falls inside its band, so moving into a higher band doesn't change the tax on everything below it.

Residential LBTT rates for 2026/27. The Scottish Budget left these unchanged.

On a £300,000 house that works out as nothing on the first £145,000, then 2% on the £105,000 up to £250,000, which is £2,100, then 5% on the last £50,000, which is £2,500. Total £4,600.

Here's the bill across the range. The average Scottish home sold for £196,000 in the year to May 2026, which puts most buyers in the second row.

Standard LBTT, single home, 2026/27 rates. Average price from the UK House Price Index for May 2026, a provisional figure that rose 4.4% over the year.

Notice how fast the effective rate climbs once you pass £325,000. That's the 10% band arriving, and it's the reason Scotland and England part company at the top of the market.

LBTT against stamp duty: the £333,000 crossover

Buying the same house on either side of the border produces two different bills, and which one is cheaper depends entirely on the price.

Standard rates, single home, 2026/27. SDLT covers England and Northern Ireland. Wales has its own Land Transaction Tax with different thresholds again.

The £400 advantage is the same at every price from £145,000 to £325,000, which is not a coincidence. Scotland's nil-rate band ends £20,000 higher than England's, and £20,000 taxed at 2% instead of 0% is worth exactly £400. Both taxes then charge 2% up to £250,000 and 5% from there, so nothing moves the gap.

Above £325,000 LBTT jumps to 10% while stamp duty stays at 5%. Every extra pound now closes the gap by 5p, so the £400 head start is gone after £8,000. That's why the two bills meet at exactly £333,000, and why the Scottish bill runs away above it.

For most buyers this lands on the right side. The average Scottish home costs £196,000, and even the City of Edinburgh, the most expensive area in Scotland, averaged £296,000 in the year to May 2026. The crossover bites on larger homes and in the pricier pockets of the central belt, where a £450,000 house carries £5,850 more tax than the same house south of the border. The pattern echoes Scottish income tax, which is cheaper below about £33,500 and dearer above it.

The surcharge, the relief, and the paperwork

The Additional Dwelling Supplement is charged on everything

If you'll own more than one dwelling at the end of the day you complete, you pay ADS on top of the LBTT. It's 8% for contracts entered into on or after 5 December 2024, up from 6% before that, and it applies from a purchase price of £40,000.

Here's the part that catches people. ADS is not sliced into bands like the LBTT above it. It's 8% of the entire purchase price, charged from the first pound. Buyers who've just worked out that their £200,000 flat attracts £1,100 of LBTT reasonably assume the surcharge works the same way, and then get a bill for another £16,000.

Second homes and buy-to-let, 2026/27. The England column is standard SDLT plus the 5% additional-property surcharge, which is charged the same way on the full price.

The £40,000 entry point is a cliff rather than a threshold. Buy at £39,999 and you pay nothing at all. Buy at £40,000 and ADS is charged on the whole £40,000, so the bill goes from zero to £3,200.

Getting ADS back when you're just moving house

Plenty of people pay ADS without owning a second home in any meaningful sense. If your purchase completes before your sale, you own two properties for a while and the surcharge applies. That money is reclaimable.

You need to dispose of your previous main residence within 36 months of the new purchase. That window was 18 months until it was doubled for transactions with an effective date on or after 1 April 2024, which matters if you bought during a slow market and assumed you'd missed it.

Claim it by amending the LBTT return, which you can do within 12 months of the filing date. After that you make a separate claim to Revenue Scotland with proof that the old property sold. It doesn't happen automatically, so if your solicitor isn't chasing it, you should.

First-time buyer relief

First-time buyers get the nil-rate band raised from £145,000 to £175,000, which is worth a flat £600 on any property above £175,000. It's a smaller break than the English version, which can save up to £5,000, but it has no upper price limit, so it still applies on a £600,000 house where the English relief would have vanished at £500,000. Our first-time buyer relief guide sets out both schemes side by side.

Filing and paying

A purchase of £40,000 or more is notifiable, which means a return goes to Revenue Scotland whether or not there's any tax to pay. Buy at £150,000 with first-time buyer relief and you owe nothing, and the return is still required. It's due within 30 days of the day after the effective date, usually the date of entry.

In practice your solicitor files it and settles the tax out of the completion funds, so you'll rarely touch the form. What you do need to do is have the cash ready, because LBTT can't be added to the mortgage and it's payable on the day.

Before you offer on anything, it's worth knowing the tax figure alongside the deposit and the fees. The LBTT calculator gives you the band-by-band breakdown with ADS and first-time buyer relief applied, and the affordability calculator tells you what a lender is likely to offer against it.

This calculator is for general guidance only. It does not replace advice from a qualified financial adviser on your personal circumstances.

Last updated: 2 August 2026