Implications of the Scottish tribunal decision in Archer.
The Tax Chamber of the First-tier Tribunal for Scotland held that the extension of a lease granted before the introduction of land and buildings transaction tax (LBTT) was not the deemed grant of a new lease for LBTT purposes. This decision has significant implications for how LBTT operates on leases and is unlikely to be the final word on the matter.
What is the case about?
Archer was tenant under a lease granted in January 2014 and ending December 2033. In July 2020 the lease was extended until December 2038. Revenue Scotland treated the extension as the grant of a new lease beginning in December 2033. Archer contended that:
- The extension of the 2014 lease did not trigger Article 13 of Land and Buildings Transaction Tax (Transitional Provisions) (Scotland) Order 2014 (the TPO) and there was no deemed new lease.
- If there was a deemed new lease it began...
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