Land and Buildings Transaction Tax (Scotland) Act 2013 Schedule 18 paragraph 5

Bare trusts

Schedule 18, paragraph 5 deals with how LBTT applies when a bare trustee acquires a chargeable interest in land or an interest in a partnership.

• Where a person acts as a bare trustee in acquiring a chargeable interest or a partnership interest, LBTT treats the interest as if it belonged directly to the beneficiary or beneficiaries
• Any actions taken by the bare trustee in relation to the interest are treated as if they were the actions of the underlying beneficiary or beneficiaries
• The bare trustee is effectively transparent or "looked through" for LBTT purposes, so the real party to the transaction is the person on whose behalf the trustee is acting
• This means the beneficiary, not the trustee, is the relevant taxpayer for LBTT purposes and bears responsibility for any tax obligations arising from the transaction