Land Transaction Tax

Land Transaction Tax Basics

From April 2018, Land Transaction Tax (LTT) replaced UK Stamp Duty in Wales and is the levy all buyers must pay when purchasing a property over £180,000. LTT is calculated on a percentage basis depending on whether or not the property is your main residence. This table sets out the tax percentage you will pay for each price band.

This table sets out the tax percentage you will pay for each price band.

Property CostMain ResidenceAdditional Homes
£0 – £180,0000%3%
£180,001 – £250,0000%6.5%
£250,001 – £400,0005%8%
£400,001 – £750,0007.5%10.5%
£750,000 – £1.5m10%13%
£1.5m+12%15%

Buy to Let and Additional Properties

Buyers purchasing an additional residential property costing more than £40,000 will incur a 3% surcharge. For example, if you buy a second home for £300,000 you will pay 3% on the first £180,000, 6.5% on the next £70,000 and 8% on the final £50,000. The total LTT fee will amount to £13,950.

Joint Ownership

If you already own a home and decide to jointly buy an additional property with a partner or a friend before selling your main residence, you are likely to be liable to pay the higher rate of tax. However, you may be able to claim a repayment if the relevant conditions are met.

Additional rate refunds

If you already own a home and decide to jointly buy an additional property with a partner or a friend before selling your main residence, you are likely to be liable to pay the higher rate of tax. However, you may be able to claim a repayment if the relevant conditions are met.

Are there any Exemptions?

There are five transactions which are exempt from LTT, these include acquisitions by the Crown, transactions in connection with a divorce or dissolution of a civil partnership and where a property has been gifted. Visit the Welsh Government’s website for the full list of LTT exempt transactions.

Joint Ownership

If you make your second home your main residence within 36 months of buying it (you sell the first property), you will be able to claim back the higher rates you paid. This can be done by contacting the Welsh Revenue Authority and providing them with:

  • the Unique Transaction Reference Number (UTRN)
  • the taxpayer’s name and address
  • the reason for a refund/amendment
  • a description of any amendments to the return
  • whether the amendment alters the amount of tax due
  • the effective date of the amendment/repayment claim
  • the amount to be repaid
  • the name of the account holder
  • your bank/building society account number and sort code
  • the name and address of your bank or building society

You will also need to include a declaration to confirm that you have the authority (or have been authorised to complete this amendment on behalf of the buyer) and declare that the information provided is to the best of your knowledge correct and complete.

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