LBTT created to replace UK Stamp Duty

The LBTT was introduced in Scotland in April 2015 in place of the UK Stamp Duty Land Tax, with the aim of creating a tax charge more proportionate to the actual price of the property.

It means people buying a home pay LBTT linked to a sliding scale aligned to the cost of the property. A separate second-home tax, known officially as the Additional Dwelling Supplement, charges an extra 3 per cent of the value on top of the LBTT.

It is estimated that a £1m residential property is £78,350 for a main home or £108,350 for an additional property. This is in contrast to the rest of the UK, where the tax on a £1m property is £43,750 for a main home or £73,750 for any additionals.