What is a 'major interest' in land under the Land and Buildings Transaction Tax (Scotland) Act 2013?

Section 60 defines two categories of major interest in land: ownership of land itself, which is the most complete property right in Scotland, and a tenant's right over or interest in land subject to a lease. All other rights, such as servitudes or standard securities, are excluded from this classification.

Why does it matter whether a land transaction involves a major interest for LBTT purposes?

The distinction matters because various provisions throughout the Act apply specifically to transactions involving a major interest. The tax treatment may differ depending on whether a major interest is involved, affecting how LBTT is calculated and which rules govern the transaction, particularly for leases and outright purchases.

Is a tenant's interest under a lease considered a major interest in land for LBTT?

Yes. Under section 60, a tenant's right over or interest in land subject to a lease is classified as a major interest. This brings leasehold transactions — including the grant, assignment, or variation of a lease — within the scope of LBTT provisions that apply specifically to major interests in land.

Are servitude rights or standard securities classified as major interests under section 60?

No. Servitude rights, such as a right of access over another person's land, and standard securities granted over property are not major interests. While they may still constitute land transactions for LBTT purposes, they are treated differently from ownership and leasehold interests under the Act.

Land and Buildings Transaction Tax (Scotland) Act 2013 section 60

Meaning of "major interest" in land

Section 60 defines what constitutes a "major interest" in land for the purposes of land and buildings transaction tax.

The Act uses the term "major interest" to distinguish the most significant forms of interest in land from lesser rights.
Ownership of land is the first type of major interest — this covers outright ownership, the most complete form of property right in Scotland.
A tenant's right over or interest in land subject to a lease is the second type of major interest — this means that leasehold interests are treated with similar significance to ownership.
Other lesser rights over land, such as servitudes or securities, are not classified as major interests and are therefore treated differently under the Act.

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