Land Transaction Tax

4th March 2021

Land Transaction Tax On 3 March 2021, the Welsh Government announced that the temporary increase to the nil rate band of Land Transaction Tax (LTT) for residential property transactions will be extended to 30 June 2021. We’ve updated our LTT calculator, services, and guidance. If you’re a tax professional read our LTT changes guide.
 

LTT is paid when you buy or lease a building or land over a certain price.

All queries on stamp duty land tax in Wales up to and including 31 March 2018 should be directed to HMRC.

Overview

You must pay LTT if you buy a property or land over a certain price in Wales.

The current LTT threshold is £250,000 for residential properties purchased at the main rates and £225,000 for non-residential land and properties.

There are different rules if you already own one or more residential properties and you may need to pay the higher residential rates. However, if you're replacing your main residence the higher rates may not apply.

You pay the tax when you:

  • buy a freehold property
  • buy a new or existing leasehold
  • are transferred land or property in exchange for payment, for example, you take on a mortgage or buy a share in a house

How much you pay

How much you pay depends on whether the land or property is:

  • residential 
  • non-residential or mixed-use 

The tax rates and bands are set by the Welsh Government and approved by Welsh Parliament.

You can use our LTT calculator to work out how much tax you’ll pay.

How and when to pay

You must send an LTT return to the WRA and pay the tax within 30 days of the day after completion (or other effective date of the transaction).

If you have a solicitor, agent or conveyancer, they’ll usually file your return and pay the tax on your behalf if you ask them to and add the amount to the sum you pay them.

If they do not do this for you, you can file a return and pay the tax yourself using the paper return.

When to file a return

You must file a return when you're entering into a notifiable transaction.

Guidance on notifiable transactions.

There are certain situations where you do not need to send a return to the WRA. 

You do not have to pay LTT or file a return if:

  • no money or other payment changes hands 
  • property is left to you in a will and you do not make any payment for the transfer of this property to you
  • property is transferred because of divorce or dissolution of a civil partnership
  • you buy a freehold property for less than £40,000
  • you buy a new or assigned lease of 7 years or more, as long as the premium is less than £40,000 and the annual rent is less than £1,000
  • you buy a new or assigned lease of less than 7 years, as long as the amount you pay is less than the residential or non-residential LTT zero rate threshold

You may be charged penalties and interest if you do not file your return and make your payment within 30 days of the day after completion (or other effective date of the transaction).