Land and Buildings Transaction Tax (Scotland) Act 2013 Schedule 8 paragraph 12

Condition E: minimum capital payment threshold

Paragraph 12 of Schedule 8 sets out Condition E, which requires that a minimum level of capital payments must have been made to the purchaser (Q) before the bond comes to an end.

• Condition E is one of the conditions that must be met for the alternative property finance relief under Schedule 8 to apply.
• The condition looks at the total capital payments made to the purchaser (referred to as Q) over the life of the bond arrangement.
• These capital payments must, by the time the bond terminates, amount to at least 60% of the value of the land interest as it stood at the time of the first transaction.
• This threshold ensures that a substantial portion of the property's original value is returned to the purchaser through the bond arrangement, reflecting a genuine financing transaction rather than a simple transfer of ownership.