Land and Buildings Transaction Tax (Scotland) Act 2013 Schedule 7 paragraph 15

Exemption of the second transaction in a financial institution arrangement

Schedule 7 paragraph 15 sets out the conditions under which the second transaction in a financial institution arrangement is exempt from LBTT charge.

• In certain financial institution arrangements, there are two linked transactions — the second transaction can be exempt from LBTT
• The exemption only applies if the financial institution fully complies with all LBTT obligations relating to the first transaction
• Compliance includes paying any LBTT due on the first transaction, calculated on a chargeable consideration that is at least equal to the market value of the interest being acquired
• Where the first transaction involves the grant of a lease, compliance also requires that the rent is properly accounted for when determining the tax due