Land and Buildings Transaction Tax (Scotland) Act 2013 Schedule 7 paragraph 2

Alternative property finance: land sold to financial institution and leased back

Schedule 7, paragraph 2 sets out the conditions under which the alternative property finance relief rules in paragraphs 3 to 6 apply, specifically where a person sells a major interest in land to a financial institution and the institution leases it back to that person.

• The relief applies where a financial institution purchases a major interest in land from a person as part of a structured arrangement between them.
• The institution then grants the person a lease (or sub-lease, if the original interest was a tenancy) out of the interest it has acquired.
• The arrangement must also include an agreement giving the person the right to require the institution to transfer the major interest back to them at a future point.
• These three elements — the purchase, the lease-back, and the buyback agreement — must all form part of the same set of arrangements between the person and the financial institution.