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Land Transaction Tax is payable by the purchaser in a land transaction which occurs in Wales. At Hart Shaw, we can provide guidance on Land Transaction Tax.
Land Transaction Tax (LTT) is payable by the purchaser of property in Wales.
LTT is payable by the purchaser of residential or non-residential property in a land transaction occurring in Wales. Stamp Duty Land Tax (SDLT) is payable on land transactions in England and Northern Ireland and Land and Buildings Transaction Tax (LBTT) on land transactions in Scotland. Please see the separate factsheets for information on SDLT and LBTT.
A transaction will trigger liability to LTT if it involves the acquisition of an interest in land. This will include a simple conveyance of land, such as buying a house, creating a lease or assigning a lease.
LTT is operated by the Welsh Revenue Authority (WRA), and individuals who are liable to the tax must complete and submit an LTT return (see later).
Individuals must send an LTT return and pay the tax due to the WRA within 30 days of the day after completion (or other effective date of the transaction). Penalties and interest may be charged if you fail to file your LTT return or pay the necessary tax within the 30 days after the day of completion.
In some circumstances, buyers are not required to send a LTT return or pay LTT. These include instances where:
For cross-border cases, a home buyer will only be required to pay SDLT on the English part of the transaction and LTT to the WRA for the Welsh part of the transaction.
The Welsh government has temporarily raised the threshold at which LTT on residential properties is paid from £180,000 to £250,000, effective from 27 July 2020 until 30 June 2021. However the tax reduction in Wales will not apply to purchases of additional properties including buy to let and second homes. The threshold for non-residential rates increased from £150,000 to £225,000 from 22 December 2020.
The rates are shown in the table below:
From 1 July 2021 the rates for residential property are:
Unlike SDLT and LBTT, LTT does not provide any relief for first-time homebuyers in Wales.
Please do contact us at Hart Shaw for guidance on Land Transaction Tax.