Land and Buildings Transaction Tax (Scotland) Act 2013 section 18

Contingent consideration

Section 18 explains how to handle consideration for a land transaction where all or part of the price depends on an uncertain future event, and establishes the assumption that must be applied when calculating the tax due.

• Contingent consideration is a payment that either only becomes due if an uncertain future event occurs, or ceases to be due if an uncertain future event occurs.
• Where consideration is contingent, the tax calculation must assume the worst-case scenario — that the maximum amount of consideration will be payable.
• This means you assume a conditional payment will be made, or that a payment which could stop will continue.
• If the actual outcome later differs from the assumption, adjustments can be made through the separate provisions for amending returns.

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