Example:

Electronic Limited are purchasing a house split into 8 flats in one transaction for £800,000. The company does not own any other dwellings. As the house has been split into 8 parts, each of which can be used as a single dwelling, at the end of the day that is the effective date for the transaction, the company owns 8 dwellings.

The ADS applies to every purchase of a dwelling in Scotland by a company.

However, as 100% relief from ADS is available for any transaction in which a buyer purchases six or more residential properties in that one transaction, the ADS will not apply to the company's purchase if relief is claimed because the transaction involves the purchase of 6 or more dwellings in one transaction. Electronic Limited will however pay ‘standard’ LBTT at non-residential rates based on the total consideration for the 8 flats.

The company may also claim MDR. To calculate the LBTT payable if MDR was claimed, see part LBTT3015 of the guidance.

Last updated: 
6 April 2016
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