Land and Buildings Transaction Tax (Scotland) Act 2013 section Sch 7 para 13

Land sold to financial institution and re-sold to person

Schedule 7 paragraph 13 sets out the conditions under which a special type of alternative property finance arrangement qualifies for LBTT relief, where a financial institution buys land and then sells it on to an individual as part of a Sharia-compliant or similar financing structure.

• The arrangement involves a person and a financial institution entering into a structured property purchase agreement.
• The financial institution first purchases a major interest in land (the "first transaction") and then sells that same interest to the person (the "second transaction").
• As part of the arrangement, the person grants the financial institution a standard security (i.e. a mortgage) over the property.
• Where these conditions are met, paragraphs 14 and 15 of Schedule 7 provide the applicable LBTT reliefs for the first and second transactions respectively.