£760m haul: Seven in ten Scottish house sales hit by Land and Buildings Transaction Tax
“There is a strong case for looking more closely at how property taxes influence people’s behaviour and the wider housing market” – John Boyle, Rettie
Scotland’s tax take on residential property sales has climbed to a record £760 million, according to new research.
Seven in ten Scottish house sales are now subject to Land and Buildings Transaction Tax (LBTT), the analysis by Edinburgh-based property firm Rettie suggests. It shows that residential LBTT revenues increased by around 13 per cent in 2025/26, driven by rising house prices and a modest increase in transactions.
When LBTT was introduced in 2015, just over half of Scottish property transactions exceeded the £145,000 threshold at which the tax becomes payable. That figure has now risen to around 70 per cent, the highest proportion since the tax was introduced.
Rettie said the figures demonstrated the growing importance of LBTT to Scotland’s public finances, but also highlighted how dependent revenues have become on a relatively small number of higher-value property transactions.
More than a third of Scottish sales are now above £250,000, compared with 16 per cent when LBTT was introduced. Around 95 per cent of LBTT revenue is generated by homes selling for more than £250,000, while properties above £750,000 account for just 1 per cent of sales but 22 per cent of revenues.
John Boyle, director of research and strategy at Rettie, said: “Residential LBTT continues to be an effective revenue source for the Scottish government, pushing towards £800m per year, around four times the level when it was first introduced.
“With little adjustment to bands since 2015, more sales are now captured and at higher tax levels. However, the tax continues to be dependent on certain geographies, notably Edinburgh, and on the small proportion of sales over £750,000.”
He added: “With LBTT revenues at record levels, there is a strong case for looking more closely at how property taxes influence people’s behaviour and the wider housing market.
“Revenues may be rising, but they remain heavily reliant on a relatively small number of higher-value sales and certain parts of the country. In that sense, this is a substantial tax take resting on relatively small supporting pillars.”
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