Land Transaction Tax (LTT)

Since 1 April 2018, Land Transaction Tax (LTT) replaced Stamp Duty Land Tax (SDLT) in Wales. Under LTT, properties worth up to £180,000 will not pay any tax. For people buying an additional residential property (that is not their only or main residence) an additional 3% on top of the main residential rate in each band will apply.

WELSH REVENUE AUTHORITY

LTT will be collected by Welsh Revenue Authority, which has been set up to manage devolved taxes in Wales.

HMRC will not accept SDLT returns for land transactions in Wales for sales on or after 1 April 2018. LTT replaces SDLT in Wales. Solicitors and legal conveyancers will need to register to file LTT returns online. More info...

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RESIDENTIAL TAX RATES

Under LTT, properties worth up to £180,000 will not pay any tax. The LTT incorporates new thresholds, with a 3.5% charge on properties between £180,000 and £250,000 and then 5% on the portion between £250,001 to £400,000, 7.5% on £400,001 to £750,001, 10% on £750,000 to £1.5m and then 12% on anything above £1.5m.

PURCHASES OF SECOND HOMES AND BUY-TO-LET PROPERTY

Higher rates of SDLT on purchases of additional residential properties (including second homes) came into effect in Wales on 1 April 2016. These will continue under LTT.

GUIDANCE

The Welsh Revenue Authority website is the best place to go for guidance on the changes and includes information on cross-border transactions and how the taxpayer is under an obligation to split the consideration given, based on the relative value of the land that falls into each tax jurisdiction.

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