Arbuthnot was born in Arbuthnot, Kincardineshire, on the north-eastern coast of Scotland, son of Rev Alexander Arbuthnot, an Episcopalian priest and Margaret, née Lammie. He "may" have graduated with an arts degree from Marischal College in 1685. Where John's brothers took part in Jacobite causes in 1689, he remained with his father. These brothers included Robert, who fled after fighting for King James VII in 1689 and became a banker in Rouen and half-brother George, who fled to France and became a wine merchant. However, when William and Mary came to the throne and the Scottish and English parliaments required all ministers to swear allegiance to them as king and queen, Arbuthnot's father did not comply. As a non-juror, he was removed from his church, and John was there to take care of affairs when, in 1691, his father died.