Minister for Public Finance & Digital Economy announces Scottish Budget 2020-21

11 February 2020

The Minister for Public Finance and the Digital Economy, Kate Forbes MSP, has proposed changes to LBTT rates and bands for lease transactions. The changes, announced in her Budget statement to Parliament today (6 February 2020), will take effect from 7 February 2020.

The proposals introduce a new rate of 2% payable where the net present value (NPV) of the rent payable under the lease is above £2 million.  The revised rates and bands are:

 NPV of rent payable  Rate of tax
 Up to £150,000  0%
 Above £150,000 to £2 million  1%
 Above £2 million  2%

The revised rates and bands will apply to transactions with an effective date on or after 7 February 2020. However, a transitional provision may apply if the agreement for the lease or missives of let for the land transaction were entered into before 6 February 2020.

In addition, the change to tax rates and bands will not apply to any further returns made in connection with the three-year review, assignation or termination of a lease where the effective date of the original lease return is between 1 April 2015 and 6 February 2020, or where the transitional provisions apply.

TO NOTE: The change to the rates and bands is being made through secondary legislation: The Land and Buildings Transaction Tax (Tax Rates and Tax Bands) (Scotland) Amendment Order 2020  (‘The Order’).

Although these changes take effect from 7 February 2020, the Order remains subject to approval by the Scottish Parliament. If the change does not become permanent, the guidance will be revised and further information will be provided on how to reclaim any additional tax paid.  

The Budget also sets out proposed changes to Scottish Landfill Tax (SLfT). The Scottish Government proposes to increase the standard rate of SLfT to £94.15 and the lower rate of SLfT to £3.00 per tonne from 1 April 2020. Legislation will be laid in parliament to provide for this.

Further information about the policies and Parliamentary process is available on the Scottish Government’s dedicated Scottish Budget web page.

Revenue Scotland has updated its tax calculators, leases guidance, worked examples and the SETS electronic tax system to reflect the Order.

Below is a complete list of Revenue Scotland’s updated guidance:


The Scottish Government’s dedicated Budget web page includes the full Budget document and the text of the Budget Statement from Ms Forbes.

For any queries relating to income tax, please visit the Scottish Government’s dedicated website page