Burness Paull
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14 Contributions by Burness Paull Experts
PRACTICE NOTES
This Practice Note sets out how to challenge a determination by Revenue Scotland concerning any of the devolved Scottish taxes. Where appropriate, it contrasts the Scottish route with the process for contesting an HMRC decision before the UK tribunals. The UK process is described in more depth in Practice Note: Appealing an HMRC decision. Be aware that strict deadlines apply throughout the appeals journey; missing any deadline can result in forfeiting the right to appeal. Moreover, Revenue Scotland’s handling of tax disagreements, encompassing litigation conduct and approaches to resolution, is anchored in the principles contained in the Revenue Scotland Settlement and Litigation Principles. It highlights comparison and distinction to assist users navigating each regime. Strict observance is essential to maintain appeal rights. For a primer on the Scottish tax tribunals, which hear appeals on devolved tax issues in Scotland, consult Practice Note:
Tax
PRACTICE NOTES
Brexit impact
At 11 pm (GMT) on 31 December 2020, the Brexit transition/implementation period that followed the UK’s exit from the EU concluded. At this moment—termed ‘IP completion day’ in UK law—transitional measures ceased and notable shifts started to apply across the UK’s legal framework. Any updates pertinent to this content will appear below.
On IP completion day, the European Union (Withdrawal) Act 2018 (EU(W)A 2018) introduced a distinct form of domestic UK law—retained EU Law (REUL)—comprising EU-derived rights and legislation kept in force in the UK after Brexit. On 29 June 2023, the Retained EU Law (Revocation and Reform) Act 2023 (REUL(RR)A 2023) received Royal Assent. It alters how REUL is handled by:
revoking substantial amounts of REUL from 31 December 2023
re‑labelling REUL as ‘assimilated law’ from 1 January 2024
creating new powers concerning assimilated law
This
Energy
PRACTICE NOTES
FORTHCOMING CHANGE :
The Scottish government has begun a review of LBTT, starting in spring 2025. Land and buildings transaction tax (LBTT) superseded stamp duty land tax (SDLT) in Scotland from 1 April 2015. This Practice Note offers a primer on LBTT. Three other Practice Notes explore specific elements in more detail, namely:
Scotland: Land and buildings transaction tax (LBTT)—chargeable consideration and LBTT rates
Scotland: Land and buildings transaction tax (LBTT)—particular transactions and taxpayers
Scotland: Land and buildings transaction tax (LBTT)—administration and compliance
Collectively, these Practice Notes cover chargeable consideration and LBTT rates, examine particular transactions and taxpayers, and set out administration and compliance matters in detail than this introductory overview provides.
Background to LBTT
The Scotland Act 1998 (SA 1988) established the Scottish Executive (now the Scottish government) and the Scottish Parliament. SA 1998 conferred limited income tax powers on those
Tax
PRACTICE NOTES
For the impact of Brexit on Scottish procedures, see Practice Note: Table showing impact of Brexit on jurisdiction to commence insolvency/restructuring proceedings and obtain recognition in other EU Member States.
This Practice Note deals with administrations as provided for in Part 3 of the Insolvency (Scotland) (Company Voluntary Arrangements and Administration) Rules 2018 (ISCVAAR 2018), SI 2018/1082. The ISCVAAR 2018 came into force on 6 April 2019, as did the Insolvency (Scotland) (Receivership and Winding Up) Rules 2018 (ISRWR 2018), SSI 2018/347.
The existence of two instruments reflects the devolution settlement and the divided responsibilities of the Scottish and UK parliaments over corporate insolvency. Consequently, a number of provisions in each set are counterparts of one another.
ISCVAAR 2018, SI 2018/1082, together with ISRWR 2018, SSI 2018/347, were designed to modernise and consolidate the Insolvency (Scotland) Rules 1986 (ISR 1986), SI 1986/1915, the
Restructuring & Insolvency
PRACTICE NOTES
This Practice Note introduces the Scottish tax tribunal system, which hears appeals concerning devolved tax issues in Scotland and operates separately from the UK tribunal framework. For guidance on lodging an appeal with the Scottish tax tribunal, see: Appealing a Revenue Scotland decision. For information on appeals within the UK tribunals, refer to Practice Note: Appealing an HMRC decision. This Practice Note does not address:
assessment to any of the devolved taxes, or
judicial review in tax matters
Outline of devolved taxes
Set out below is a brief overview of the Scottish devolved taxes within the jurisdiction of the Scottish tax tribunal system. See also Practice Note: Devolved taxes in the UK—Scotland, Wales and Northern Ireland. The Scotland Act 2012 broadened the Scottish Parliament’s devolved competencies, including authority to impose taxes on land transactions and on waste sent to landfill. The Scotland Act 2012
Tax
PRACTICE NOTES
This Practice Note addresses the initiation of creditors’ voluntary liquidations (CVLs) as provided in Part IV of the Insolvency Act 1986 (IA 1986) and the Insolvency (Scotland) (Receivership and Winding up) Rules 2018 (ISRWUP Rules 2018), SSI 2018/347, r 4.1 (Part 4). It excludes the commencement of members’ voluntary liquidations (MVLs) in Scotland and does not deal with the relevant law, procedure and practice after a CVL has begun and been approved by creditors, through to exit and dissolution.
Scottish Insolvency Rules 2018
The Insolvency (Scotland) (Company Voluntary Arrangements and Administration) Rules 2018, SI 2018/1082, and the ISRWUP Rules 2018, SSI 2018/347 (together, the ‘2018 Rules’), took effect on 6 April 2019. This Practice Note has been revised to reflect the operation of the 2018 Rules. It does not consider any transitional provision, on the basis that few cases are expected to remain to which such
Restructuring & Insolvency
PRACTICE NOTES
FORTHCOMING CHANGE :
The Scottish government has begun a review of LBTT, starting in spring 2025. Priority topics include whether non-residential bands should apply to 'mixed' deals, multiple dwellings relief, the 6+ exclusion from the additional dwellings supplement, first time buyer relief, the triennial lease review return cycle, and options for aligning LBTT rates with net zero objectives. Amendments are not anticipated until after the Scottish Parliament elections, which must occur by 7 May 2026.
This Practice Note forms part of a suite on Scotland’s land and buildings transaction tax (LBTT):
Scotland: Land and buildings transaction tax (LBTT)—the basics
Scotland: Land and buildings transaction tax (LBTT)—chargeable consideration and rates of LBTT
Scotland: Land and buildings transaction tax (LBTT)—particular transactions and taxpayers, and
Scotland: Land and buildings transaction tax (LBTT) on
Tax
PRACTICE NOTES
FORTHCOMING CHANGE :
The Scottish government has started a review of LBTT that began in spring 2025. Areas under particular scrutiny include:
using non‑residential rates for ‘mixed’ transactions
multiple dwellings relief
the 6+ exemption from the additional dwellings supplement
first time buyer relief
the three‑yearly lease review returns
whether LBTT rates can be aligned with net zero objectives
No alterations are expected until after the Scottish Parliament elections (which must take place by 7 May 2026).
How is LBTT calculated?
The land and buildings transaction tax (LBTT) due on a land transaction is worked out by applying the relevant tax rate or rates (including a nil rate) to the chargeable consideration. Where transactions that appear separate are linked under the legislation, the LBTT must be computed as if there were a single transaction. Revenue Scotland provides online tools to calculate the LBTT due—see the Revenue Scotland property transactions calculator and the lease
Tax
PRACTICE NOTES
FORTHCOMING CHANGE :
A review of LBTT by the Scottish Government began in spring 2025. It is also exploring LBTT reliefs for Co-ownership Authorised Contractual Schemes (CoACS), Property Authorised Investment Funds (PAIFs) and Reserved Investor Funds (RIFs), with a consultation paper issued on 11 July 2025. For more details, see OEICS (including PAIFs), CoACSs and RIFs below. Background and overarching principles for land and buildings transaction tax (LBTT) appear in Practice Note: Scotland: Land and buildings transaction tax (LBTT)—the basics. This Practice Note outlines how LBTT operates for specific categories of transactions and taxpayers, including:
leases and licences
options and right of pre-emption
contract providing for conveyance to third party
sub-sale development relief
exchanges and partitions
partnerships
joint buyers
residential property holding companies
trusts
open ended investment companies (OEICs) and certain other types of funds
charities
group relief
pension funds
green freeports
certain acquisitions by local authorities
For further information about LBTT, see the other Practice Notes on
Tax
PRACTICE NOTES
Scottish GAAR
The Scottish GAAR is intended to safeguard tax and public revenues by tackling artificial tax avoidance arrangements, and is designed to work in parallel with the targeted anti-avoidance rules embedded in the legislation that implements the devolved taxes. It has applied from 1 April 2015 and covers devolved taxes. A devolved tax is one designated as such by Part 4A of the Scotland Act 1998. The devolved taxes currently operating are land and buildings transaction tax (LBTT) and Scottish landfill tax (SLFT). Air departure tax, the aggregates levy and wild fisheries taxes are listed in Part 4A as devolved, but have not yet commenced, although the aggregates levy is anticipated to commence on 1 April 2026. The Scottish rate of income tax is not devolved; it remains administered by HMRC and falls outside the Scottish GAAR. Although the statutory framework for the
Tax
PRACTICE NOTES
Macfarlanes and Burness Paull advised Dobbies Garden Centres, the UK’s largest operator of garden centres, on its restructuring plan (RP) under Part 26A of the Companies Act 2006 (CA 2006), which was approved by Lord Braid in the Court of Session in Scotland on 9 December 2024.
An RP is a mechanism by which a financially distressed company may propose a compromise or arrangement with its creditors in order to remove, lessen, avert, or soften the impact of its financial difficulties. These compromises and arrangements can be structured in many ways, including, for example, amendments and extensions of debt obligations, debt-for-equity swaps, and alterations to lease terms together with compromises of rent payable under leases and other property-related liabilities. The RP was introduced during the coronavirus (COVID-19) pandemic to offer a new restructuring tool in the UK. Whilst there is
Restructuring & Insolvency
PRACTICE NOTES
Brexit impact
At 11pm (GMT) on 31 December 2020, the transition/implementation phase that followed the UK’s departure from the EU came to a close. That moment—known in UK law as ‘IP completion day’—ended core transitional measures and triggered wide-ranging changes across the UK legal framework. Any updates relevant to this content are outlined below.
On IP completion day, the European Union (Withdrawal) Act 2018 (EU(W)A 2018) introduced a distinct category of domestic UK law—retained EU law (REUL)—consisting of EU-derived rights and legislation preserved in the UK after Brexit.
On 29 June 2023, the Retained EU Law (Revocation and Reform) Act 2023 (REUL(RR)A 2023) received Royal Assent. It reshapes the treatment of REUL by:
revoking substantial elements of REUL from 31 December 2023
re-labelling REUL as ‘assimilated law’ from 1 January 2024
creating new powers in relation to assimilated law
This
Energy
CHECKLISTS
FORTHCOMING CHANGE :
The Scottish Government is undertaking a review of LBTT, which began in spring 2025. This Table outlines how land and buildings transaction tax (LBTT) applies to standard lease transactions...
Tax
CHECKLISTS
What is the capital goods scheme?
The capital goods scheme (CGS) offers a method to adjust, over a defined timeframe, the VAT initially incurred on substantial capital outlay. For property, that timeframe is ten years and applies where expenditure of £250,000 or more has been made. The adjustment mirrors changes in taxable use during the relevant period. For a more detailed overview, see Practice Note: VAT—capital goods scheme (CGS).
When should a property lawyer be alert to the CGS?
CGS considerations can arise in the following situations:
the sale or purchase of commercial property, residential property, relevant charitable property (RCP) or relevant residential property (RRP)
acquiring a property that qualifies as a transfer of a going concern (TOGC)
granting a lease where the option to tax has not been, cannot be, or is disapplied
In each case, this concerns a property within the CGS,
Tax
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