LTT Land Transaction Tax – Wales

Comment: This chapter explains the basics of Land Transaction Tax (LTT) in Wales, which replaced Stamp Duty Land Tax (SDLT) in 2018.

Key Points:

  • LTT is managed by the Welsh Revenue Authority and applies to residential and non-residential properties over £225,000.
  • Buyers of additional properties may face higher rates.
  • Reliefs are available for specific situations, but there is no first-time buyer relief.
  • Returns and payments must be filed within 30 days of the transaction.

Main Principles:

  • Who Pays LTT: Buyers of properties over £225,000 must pay LTT, with higher rates for additional properties.
  • How Much You Pay: The amount varies based on property type and value, with specific tools available for calculation.
  • Reliefs and Exemptions: Certain purchases, like multiple dwellings or charity acquisitions, qualify for relief.
  • Filing Returns: Returns must be filed online within 30 days, with penalties for late submissions.

Land Transaction Tax (LTT) is a tax on property or land purchases in Wales, replacing Stamp Duty Land Tax (SDLT) from 1 April 2018. Managed by the Welsh Revenue Authority (WRA), LTT applies to both residential and non-residential transactions above certain price thresholds, currently set at £225,000. This tax is applicable when buying freehold properties, new or existing leaseholds, or when land or property is transferred in exchange for payment.

Who Pays LTT

  • Thresholds: LTT is payable for residential and non-residential properties over £225,000.
  • Property Owners: Buyers owning additional properties may face higher rates, though exceptions exist for those replacing their main residence.
  • Self-Assessment: It’s the buyer’s responsibility to submit accurate returns and pay any due tax.

How Much You Pay

The LTT amount varies based on the property type (residential vs. non-residential) and specific circumstances, such as owning additional properties or buying cross-border property. Tools like the WRA’s tax calculator and postcode checker can help determine tax amounts and property locations in Wales.


While there’s no first-time buyer relief in Wales, reliefs are available for situations like purchasing multiple dwellings, corporate group transactions, and charity property acquisitions. Solicitors or conveyancers can assist in claiming eligible reliefs.

Filing Returns and Payment

From 3 July 2023, solicitors and conveyancers must file LTT returns online. Private taxpayers without professional assistance must request a paper return. Returns and payments are due within 30 days post-completion, with penalties for late submissions.


No LTT filing is required for properties inherited from wills, transfers due to divorce, properties under £40,000, leaseholds with premiums under £40,000 and annual rent below £1,000, or leases under 7 years if the transaction value falls below the LTT threshold. 

Differences Between LTT and SDLT

(LTT Land Transaction Tax – Wales)

➤ LTT in Wales uses different rates, rules, and reliefs compared to SDLT in England and Northern Ireland, often resulting in higher residential taxes and lower commercial taxes.

The guidance from the Welsh Revenue Authority highlights several key differences between Land Transaction Tax (LTT) and Stamp Duty Land Tax (SDLT), as summarised below:

Rates and Bands:

  • LTT: Set by the Welsh Government. A tax calculator is provided for calculating LTT.
  • SDLT: Set by the UK Government. HMRC’s tax calculator is used for calculating SDLT.

Higher Rates. Intermediate Transaction Rule:

  • LTT: An intermediate transaction, such as purchasing a buy-to-let property before buying a new main residence, can trigger the higher rates if the previous main residence was disposed of.
  • SDLT: Does not apply an intermediate transaction rule.

Definition of Residential and Non-Residential:

  • Both LTT and SDLT have their own specific interpretation guidance, but they define residential and non-residential properties differently according to their respective regulations.

Residential Leases:

  • LTT: Only payable on premiums or other non-rent consideration. Rent figures are not required for new residential lease returns.
  • SDLT: Charged on both rent and any premium or other consideration for a new residential lease.

Non-Residential Leases: Relevant Rent Rule:

  • LTT: Applies a 0% band for premiums up to £150,000, which can increase to 1% where the ‘relevant rent’ exceeds £13,500.
  • SDLT: Does not apply a relevant rent rule.


  • LTT: No first-time buyer relief is available; the 0% band applies to purchases up to £225,000.
  • SDLT: Offers first-time buyer relief; the 0% band applies to purchases up to £250,000, or £425,000 for first-time buyers.

Avoidance and Compliance:

  • LTT: An anti-avoidance rule applies to all reliefs, with a general anti-avoidance rule to counter artificial tax avoidance arrangements.
  • SDLT: Targets specific aspects of particular reliefs with Sections 75A-C Finance Act 2003 anti-avoidance rules.


Rates and bands of LTT

(LTT Land Transaction Tax – Wales)

➤ LTT in Wales often results in higher taxes for residential properties and lower taxes for commercial properties compared to SDLT in England and Northern Ireland, due to varied rate bands and calculations.

Comparing LTT and SDLT: Rates, Bands, and Practical Examples

Below, we explore the rates and bands of LTT and compare them with SDLT, providing examples to illustrate their practical implications.


LTT for Residential Properties

Rates from 30 June 2021:

  • Up to £250,000: 0%
  • £250,001 to £400,000: 5%
  • £400,001 to £750,000: 7.5%
  • £750,001 to £1,500,000: 10%
  • Above £1,500,000: 12%

Example: Buying a house in Wales for £300,000 in May 2021 incurs LTT of £2,500, calculated as 0% on the first £250,000 and 5% on the remaining £50,000.


Higher Residential Tax Rates (LTT)

Effective Date on or after 22 December 2020:

  • Up to £180,000: 4%
  • £180,001 to £250,000: 7.5%
  • £250,001 to £400,000: 9%
  • £400,001 to £750,000: 11.5%
  • £750,001 to £1,500,000: 14%
  • Above £1,500,000: 16%

Example: Purchasing a second home in Wales for £300,000 results in LTT of £16,950, calculated across the various bands.


Non-Residential Property Tax Rates (LTT)

Effective Date on or after 22 December 2020:

  • Up to £225,000: 0%
  • £225,001 to £250,000: 1%
  • £250,001 to £1,000,000: 5%
  • Above £1,000,000: 6%

Example: Acquiring commercial property for £300,000 incurs LTT of £2,750, calculated as 0% on the first £225,000 = £0, 1% on next £25,000 = £250, 5% on the next £50,000 = £2,500


Examples. LTT Rates in Comparison With SDLT

(LTT Land Transaction Tax – Wales>Rates and bands of LTT)

➤ When buying property, LTT in Wales often results in a higher tax for residential properties but can be lower for commercial properties compared to SDLT in England and Northern Ireland, due to different rate bands and calculations.

Comparing LTT and SDLT: Rates, Bands, and Example Calculations

Land Transaction Tax (LTT) is the tax on land transactions in Wales, whereas Stamp Duty Land Tax (SDLT) applies to land transactions in England and Northern Ireland. Each has its unique rates and bands, affecting property transactions differently based on location and specifics of the deal.


Comparison: LTT vs. SDLT on £800,000 Residential Property Purchase by a Developer

LTT Calculation

  • Up to £180,000 at 4% = £7,200
  • Above £180,000 and up to £250,000 at 7.5% = £5,250
  • Above £250,000 and up to £400,000 at 9% = £13,500
  • Above £400,000 and up to £750,000 at 11.5% = £40,250
  • Total LTT Due: £73,200

SDLT Calculation

  • Up to £250,000 at 3% = £7,500
  • Above £250,000 and up to £925,000 at 8% = £44,000
  • Total SDLT Due: £51,500


When purchasing a residential property for £800,000 by a limited company for development, LTT imposes a higher tax burden compared to SDLT. The total LTT due is £73,200, which is significantly higher than the SDLT total of £51,500. This difference is attributed to the LTT’s higher progressive rates in the upper bands, reflecting Wales’ tax policy for property transactions within its jurisdiction.


  1. Commercial Building Purchased for £800,000 by a Limited Company for Development

LTT Calculation for £800,000 Commercial Building Purchase

  • Up to £225,000 at 0% = £0
  • Above £225,000 and up to £250,000 at 1% = £250
  • Above £250,000 and up to £1,000,000 at 5% = £27,500
  • Total LTT Due: £27,750

SDLT Calculation for £800,000 Commercial Building Purchase

  • Up to £150,000 at 0% = £0
  • Above £150,000 and up to £250,000 at 2% = £2,000
  • Above £250,000 at 5% = £27,500
  • Total SDLT Due: £29,500


When comparing the Land Transaction Tax (LTT) in Wales with the Stamp Duty Land Tax (SDLT) for a commercial building purchased for £800,000, the LTT amounts to £27,750, while the SDLT comes to £29,500. The difference arises primarily from the initial tax bands: LTT offers a 0% rate up to £225,000 and a 1% rate on the next £25,000, while SDLT imposes a 2% rate on the portion from £150,001 to £250,000. Consequently, LTT presents a slightly lower tax liability for this specific transaction.


Home Purchased for £800,000 at Normal Residential Rates

LTT (Land Transaction Tax):

  • Up to £225,000: 0% = £0
  • Above £225,000 and up to £250,000: 1% = £250
  • Above £250,000 and up to £1,000,000: 5% = £27,500
  • Total LTT Due: £27,750

SDLT (Stamp Duty Land Tax):

  • Up to £225,000: 0% = £0
  • Above £225,000 and up to £400,000: 6% = £10,500
  • Above £400,000 and up to £750,000: 7.5% = £26,250
  • Above £750,000 and up to £1,500,000: 10% = £5,000
  • Total SDLT Due: £41,750


For a home purchased at £800,000, LTT imposes a lower tax burden (£27,750) compared to SDLT (£41,750). This difference is primarily due to SDLT’s higher rates for portions of the property value above £400,000, which significantly increase the tax liability under SDLT compared to LTT in this price range.


Higher Rates of Land Transaction Tax (LTT) in Wales

(LTT Land Transaction Tax)

Higher LTT rates in Wales apply to additional properties over £40,000, with exceptions for replacing main homes and certain property types.

When Higher Rates Apply

  • Criteria for Higher LTT Rates: Higher Land Transaction Tax (LTT) rates apply when purchasing a residential property over £40,000 while owning one or more additional properties. This includes properties held for children under 18 or as a trust beneficiary.
  • Company Purchases: Companies face higher rates on residential properties worth £40,000 or more unless the property is subject to a lease with over 21 years remaining.
  • Transfers of Equity: These transactions are subject to higher LTT rates as well.

Marital and Partnership Considerations

  • Married Couples and Civil Partnerships: The ownership status of either partner affects the LTT rate for both, treating the purchase as a joint transaction even if only one partner is involved.
  • Joint Purchases: When buying property with others, if any individual (including their spouse) qualifies for higher rates, the entire transaction is subject to these rates.

Exemptions from Higher Rates

  • Main Home Replacement: Higher rates do not apply if the new property will serve as your main residence and you have sold or will sell your previous main residence on the day of or before the purchase.
  • Exemptions Based on Property Type or Value: Properties worth less than £40,000, mixed-use properties, moveable dwellings like caravans, houseboats, or mobile homes, and freehold properties subject to a long-term lease held by someone unconnected to you are exempt from higher rates.


For a residential property valued at £350,000:

  • The normal LTT liability would be £7,500.
  • The higher rate LTT liability would be £21,450.
  • The total difference in LTT liability between the normal and higher rates is £13,950.

For a residential property valued at £2 million:

  • The normal LTT liability would be £171,750.
  • The higher rate LTT liability would be £251,200.
  • The total difference in LTT liability between the normal and higher rates is £79,450. ​​


LTT Refunds, Reliefs, and Exceptions

(LTT Land Transaction Tax>Higher Rates of Land Transaction Tax (LTT) in Wales)

You can get a refund on the higher LTT rates if you sell your old main home within 3 years of buying a new one, but not if you keep part of the old home; there are also reliefs for buying multiple properties or properties with several dwellings.

Refunds for Higher Rates

  • Eligibility: If you sell your previous main home within 3 years of purchasing a new main home, you may be eligible for a refund.
  • Refund Amount: The refund covers the difference between higher and main rates of Land Transaction Tax (LTT).
  • Condition: Higher rates apply if you buy a new main home before selling the old one.
  • Restrictions: No refund is available if you or your spouse/civil partner retains any part of the previous main home or if higher rates apply for another reason.

Reliefs and Exceptions

  • Multiple Dwellings Relief: Eligible if purchasing more than one property, potentially reducing LTT.
  • Subsidiary Dwelling Exception: Applies if buying a property with two or more dwellings.
  • Choice for Buying 6+ Properties: Option to pay either non-residential rates of LTT or higher rates with multiple dwellings relief.


Land Transaction Tax (LTT) Exemptions

(LTT Land Transaction Tax)

LTT exemptions in Wales cover situations like no chargeable consideration, transfers on death, between spouses, for charities, public bodies, compulsory purchases, right to buy schemes, certain lease renewals, and group company transfers.

Land Transaction Tax (LTT) exemptions are specific situations where transactions involving the transfer of land or property in Wales are not subject to LTT. While the detailed guidance from the Welsh Revenue Authority outlines all applicable exemptions and reliefs, a summary of common LTT exemptions includes:

Transfers of land or property with no chargeable consideration
Transactions where no monetary exchange or equivalent consideration is involved may be exempt from LTT.

Certain property transfers on death
Transfers of property as a result of a will or intestacy are typically exempt from LTT.

Transfers between spouses or civil partners
Property transfers between spouses or civil partners as part of a divorce settlement or dissolution of a civil partnership generally do not attract LTT.

Transactions involving charities where the property is acquired for charitable purposes may be exempt from LTT, provided certain conditions are met.

Public bodies
Transfers involving certain public bodies can be exempt from LTT, recognising their role in public service delivery.

Compulsory purchase orders
Property acquired under compulsory purchase orders may be exempt from LTT under specific circumstances.

Right to buy and similar schemes
Transactions under ‘right to buy’ schemes for social housing tenants often qualify for LTT exemptions.

Certain types of lease renewals
Under specific conditions, the renewal of leases may be exempt from LTT, especially when no premium is involved.

Group relief
Transfers within a group of companies may be exempt from LTT, facilitating internal restructuring without incurring additional tax costs.


Land Transaction Tax (LTT) Reliefs

(LTT Land Transaction Tax)

➤ LTT in Wales offers various reliefs for charities, social housing, public bodies, multiple dwellings, specific finance structures, and special transactions, reducing tax burdens under certain conditions.

Charities Relief
Exempts charities from LTT on property purchases if the property will be used for charitable purposes.

Relief for Certain Acquisitions of Dwellings
Offers relief in specific scenarios, such as housebuilders or property traders buying from individuals acquiring new dwellings, aiding in chain break situations or employment relocations.

Acquisitions Involving Multiple Dwellings
Reduces LTT liability by treating the purchase of multiple dwellings as a single transaction for tax calculation, potentially lowering the effective tax rate.

Calculate Land Transaction Tax with Multiple Dwellings Relief
Involves a specific calculation method that averages the tax across multiple dwellings, providing substantial financial benefits under certain conditions.

Social Housing Relief
Provides relief for social landlords, promoting affordable housing development and transactions.

Relief for Incorporation of Limited Liability Partnerships
Facilitates the transfer of property into an LLP without LTT, under certain conditions to support business restructuring.

Alternative Property Finance Reliefs
Covers transactions structured under Islamic finance principles, ensuring no additional LTT burden compared to conventional finance methods.

Open-ended Investment Company Reliefs
Exempts transactions involving open-ended investment companies from LTT, facilitating investment fluidity.

Compulsory Purchase Relief and Planning Obligations Relief
Offers relief for property acquisitions under compulsory purchase orders or as part of planning obligations, supporting public interest developments.

Relief for Acquisitions by Public Bodies and Health Bodies
Exempts public and health bodies from LTT on acquisitions for public or healthcare purposes.

Sale and Leaseback Relief
Provides relief for sale and leaseback arrangements, often used in financing, to avoid double taxation.

Reconstruction and Acquisition Reliefs
Aids corporate restructuring by exempting transactions that meet specific criteria, promoting economic efficiency.

Alternative Finance Investment Bonds Relief
Ensures that transactions involving alternative finance investment bonds are not disadvantaged in terms of LTT compared to conventional finance methods.

Lighthouses Relief
Exempts transactions involving the transfer of lighthouses, supporting their maintenance and operation without the burden of LTT.

Visiting Forces and International Military Headquarters
Provides relief for property transactions involving international military forces and headquarters, recognising their special status and diplomatic agreements.

Relief for Property Accepted in Satisfaction of Tax
Allows properties transferred to the government or public bodies in lieu of tax payments to be exempt from LTT, facilitating such tax settlement methods.

Trunk Roads Relief
Offers exemption from LTT for land transactions related to the development or maintenance of trunk roads, supporting infrastructure projects.

Relief for Acquisitions by Bodies Established for National Purposes
Exempts national institutions and bodies from LTT on property acquisitions, acknowledging their contribution to national interests.

Relief for Acquisitions in Consequence of Reorganisation of Parliamentary Constituencies
Provides LTT relief for property transactions necessitated by changes in parliamentary constituency boundaries, ensuring smooth administrative adjustments.

Clarifies the definitions and applicability of various terms and conditions related to LTT reliefs, ensuring a clear understanding and implementation of relief provisions.

Building Societies Relief
Exempts building societies from LTT in certain transactions, recognising their role in the housing finance sector.

Friendly Societies Relief
Offers LTT relief to friendly societies, supporting their operations and contributions to the social and financial welfare of their members.

Co-operative and Community Benefit Society and Credit Union Relief
Provides LTT exemptions for co-operatives, community benefit societies, and credit unions, acknowledging their importance in the community and financial sectors.

Relief from LTT Provided by UK Legislation in Relation to Diplomatic and International Organisations
Exempts diplomatic entities and international organisations from LTT, in line with international agreements and diplomatic practices.


Relief for acquisitions involving multiple dwellings

(LTT Land Transaction Tax>Land Transaction Tax (LTT) Relief)

When buying more than one dwelling in Wales, you can claim Multiple Dwellings Relief to potentially lower your LTT, but you need to meet certain conditions and remember some transactions don’t qualify for this relief.

When purchasing a property in Wales that comprises more than one dwelling in a single transaction or linked transactions, you can claim Multiple Dwellings Relief (MDR). This relief applies to various scenarios, such as houses with annexes, a house with a cottage in its grounds, or two neighbouring houses.

Eligibility for MDR

To qualify for MDR, each dwelling within the transaction must be a standalone dwelling, characterised by having:

  • A kitchen area for food storage, preparation, cooking, and washing up.
  • A bathroom including a toilet, sink, and bath or shower.
  • A living and sleeping space.
  • Independent access.

Dwellings must be private and secure, without free movement between them (e.g., through a common hallway). If there are interconnecting doors, they should be lockable at the time of purchase.

Higher Rates of LTT

When claiming MDR, consider if the higher rates of LTT apply due to purchasing more than one dwelling.

Claiming the Relief

MDR is claimed on your LTT return. If initially unclaimed, you can amend your return to claim MDR and request a refund of any extra tax paid within 12 months of the original filing date.

6 or More Residential Properties

Where 6 or more dwellings are acquired, the taxpayer can claim MDR, and the total dwellings would be subject to higher residential rates. If MDR is not claimed, the total consideration would be subject to non-residential property rates.

Calculating Tax with MDR

MDR is a partial relief, meaning some LTT will always be due. To calculate:

  1. Divide the total purchase price by the number of dwellings.
  2. Calculate LTT for the amount obtained in step 1.
  3. Multiply the LTT figure from step 2 by the number of dwellings to get the total LTT payable.

Use the MDR calculator or LTT calculator for assistance.

Minimum Tax Rule

With MDR, you must pay at least 1% of the property’s purchase price in LTT. If calculations yield less, adjust the amount to meet this minimum.

When MDR Does Not Apply

MDR cannot be claimed in conjunction with certain other reliefs, such as group relief, reconstruction and acquisition relief, charities relief, and relief for persons exercising collective rights. It’s also not available for some transactions involving leasehold interests.

Example Calculation Using MDR

For a Single Property Purchased for £800,000 Subject to Higher Rates of LTT:
Total tax due: £73,200

For Each Property Purchased for £200,000 Subject to Higher Rates of LTT:
Total tax due: £8,700

Since there are four properties each costing £200,000, the total tax due for all four properties would be: 4 * £8,700 = £34,800

Difference in Tax Due:
Tax for one £800,000 property: £73,200
Total tax for four £200,000 properties: £34,800


Reliefs for Acquisitions of Dwellings

(LTT Land Transaction Tax>Land Transaction Tax (LTT) Relief)

➤ In Wales, you can get LTT relief when buying houses under specific conditions, including when buying from housebuilders, property traders, or due to employment relocation, but each relief has its own rules to follow.

In Wales, you can get relief from Land Transaction Tax (LTT) when buying residential properties if certain conditions are met. 

  • Who Can Get Relief: This relief isn’t available to everyone. Sole traders, individuals, or partnerships that have individuals as members won’t qualify, except if you’re part of a limited liability partnership.
  • What You Need to Do: If your property transaction needs to be reported, you have to fill out a land transaction return. This is where you claim the relief, depending on the specifics of your transaction.
  • Special Case for Big Gardens: If the property you’re buying comes with a large garden or grounds that go beyond what’s usually allowed, you might still be able to claim some relief. The catch is that every other condition for relief must still be met.

Remember, to benefit from these reliefs, each transaction type has its own set of requirements that need to be fulfilled to avoid LTT charges.

Relief for Acquisition by Housebuilder from Individual Acquiring New Dwelling Provides LTT relief when a housebuilder buys an old dwelling from an individual who is simultaneously purchasing a new dwelling from the housebuilder, under the condition that the old dwelling was the individual’s main or only residence within the last two years.

Relief for Acquisition by Property Trader from Individual Acquiring New Dwelling
Offers LTT relief for property traders acquiring a dwelling from an individual who is buying a new dwelling, aiming to facilitate smooth property transactions and support housing mobility.

Relief for Acquisition by Property Trader from Individual Where Chain of Transactions Breaks Down
Allows LTT relief for property traders purchasing a dwelling from an individual in instances where a property transaction chain breaks, helping to resolve stalled property transactions.

Relief for Acquisition by Property Trader from Personal Representatives
Provides LTT relief to property traders acquiring dwellings from the personal representatives of a deceased individual, ensuring the deceased’s property can be efficiently transferred.

Relief for Acquisition by Property Trader in Case of Relocation of Employment
Grants LTT relief to property traders buying a dwelling from an individual relocating for employment, facilitating the mobility of the workforce.

Relief for Acquisition by Employer in Case of Relocation of Employment
Offers LTT relief for employers acquiring a dwelling from an employee who is relocating for work, supporting employee relocation processes.

Partial Relief for Certain Acquisitions of Dwellings
Enables partial LTT relief for transactions that meet certain conditions but involve land exceeding the permitted area, providing a balanced approach to tax relief.

Withdrawal of Relief for Certain Acquisitions of Dwellings
Details conditions under which previously granted LTT reliefs for dwelling acquisitions can be withdrawn, ensuring the integrity of relief provisions.

Relief for Persons Exercising Collective Rights
Provides LTT relief for individuals collectively exercising rights to buy the freehold of their building, supporting collective ownership efforts.


Land Transaction Tax (LTT) on Leases

(LTT Land Transaction Tax)

➤ LTT on leases in Wales depends on the lease type, with specific rules for non-residential and mixed leases, including rent calculations, lease variations, and certain exemptions.

LTT on Residential vs. Non-Residential Leases

  • Residential Leases: LTT is not charged on the net present value (NPV) of rents payable upon the grant of a residential lease.
  • Non-Residential and Mixed Leases: LTT is payable on the NPV of rents and any other consideration (e.g., a premium) upon the grant of non-residential or mixed leases.

Charging Rules for Non-Residential Leases

  • Grant of Lease: For non-residential leases, both the rent payable and any consideration other than rent are subject to LTT.
  • Assignment of Lease: Generally, only the consideration given to acquire the lease is chargeable, as rents are typically taxed at the grant of the lease.

Definition of a Lease

  • A lease is defined as an interest or right in or over land for a term of years or any interest that can be ended by notice of termination or immediately.


  • Licences to occupy land and tenancies at will are considered exempt interests and are not chargeable to LTT.

Key Aspects

  • LTT on Leases: LTT is only payable on the net present value (NPV) of rents for non-residential and mixed leases. Special rules apply for mixed leases that include both residential and non-residential property.
  • Calculation of Tax: For non-residential or mixed leases, tax is based on the NPV of rent over the lease term. The calculation involves determining the highest rent in any 12-month period within the first five years and using this figure for longer lease terms.
  • Lease Variations: Changes to lease terms, such as rent increases or term reductions, can trigger additional LTT liabilities. Certain variations are treated as new leases for LTT purposes.
  • Assignments and Successions: Assignments of leases are generally taxed on consideration other than rent. Successive leases between the same parties may be linked for LTT purposes, impacting tax calculation.
  • Rent Reviews and Variable Rents: Leases with variable or uncertain rents require reasonable estimates for LTT calculations. Specific rules apply for rent reviews within the lease’s first five years.
  • Premiums and Deposits: Consideration other than rent, such as premiums or deposits, is chargeable to LTT. However, reverse premiums paid by landlords to tenants are not considered chargeable consideration.
  • Exclusions: Certain tenant obligations, like repair or maintenance undertakings, are not considered chargeable consideration for LTT.
  • Overlap Relief: Applies when a new lease is granted over the same premises, ensuring tenants do not pay LTT twice for the same period.

Specific Rules and Exceptions

  • Rent Thresholds: The relevant rent threshold, affecting the calculation of consideration other than rent, changed in February 2021 to £13,500.
  • Overlap Periods: For calculating NPV under a new lease, rent payable is reduced for any overlap period with a previous lease to avoid double taxation.
  • Agreements for Lease: Substantial performance of an agreement for lease can trigger LTT liabilities as if a notional lease had been granted.
  • Indefinite Terms and Extensions: Leases with indefinite terms or that extend beyond their fixed term are subject to specific LTT rules, potentially requiring additional tax payments or filings.
  • Successive Linked Leases: Successive leases that are linked for LTT purposes are calculated as if they were a single lease, potentially affecting the tax due.


Chargeable Consideration

(LTT Land Transaction Tax)

Chargeable consideration for LTT includes money, non-monetary assets, VAT, foreign currency, and debt, while requiring just and reasonable apportionment and specific handling for deferred payments and connected companies.

The guidance details the components of chargeable consideration in land transactions under the Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017. It encompasses both monetary and non-monetary considerations, including the valuation of non-monetary assets, the role of VAT, and how to handle deferred consideration.

Key Points

Chargeable Consideration (LTTA/2260)
Includes any money or money’s worth given directly or indirectly for the transaction, by the buyer or those connected to them.

Fixtures and Fittings (LTTA/2261)
Items annexed to the property (e.g., fitted kitchen units, central heating systems) are subject to LTT. Movable items (e.g., carpets, free-standing furniture) are not.

Money or Money’s Worth (LTTA/2270)
Encompasses actual money and anything with a monetary value that can be realised, such as art, vehicles, or shares.

Foreign Currency Conversion (LTTA/2280)
Consideration in foreign currency is converted based on the closing exchange rate on the transaction’s effective date.

Valuation of Non-monetary Consideration (LTTA/2290)
Non-monetary consideration is valued at its market value on the transaction’s effective date.

Market Value (LTTA/2300)
Determined in alignment with the Taxation of Chargeable Gains Act 1992, including VAT considerations.

VAT (LTTA/2310)
Chargeable consideration includes any VAT chargeable on the transaction.

Deferred Consideration (LTTA/2320)
Full agreed consideration is chargeable, without discounts for future payments.

Just and Reasonable Apportionment (LTTA/2330)
Requires apportionment of consideration between land transactions and other matters on a just and reasonable basis.

Debt as Consideration (LTTA/2400)
Includes satisfaction, release, or assumption of debt as part of the transaction.

Annuities (LTTA/2450)
Annuity payments as consideration are treated as a one-off payment comprising 12 years’ payments.

Connected Company Transactions (LTTA/2460 & LTTA/2470)
Special rules apply to transactions between connected companies, with market value often serving as the chargeable consideration, subject to specific exceptions.


Tax Returns and Payments 

(LTT Land Transaction Tax)

➤ In Wales, you must file an LTT return within 30 days for notifiable land transactions, include a self-assessment, and pay any due tax by the filing date, with certain exceptions and special rules.


The Welsh Revenue Authority (WRA) offers detailed guidance on the requirements for filing Land Transaction Tax (LTT) returns and making payments. This guidance is essential for professionals handling land transactions in Wales. It covers the duty to deliver LTT returns, identifies notifiable transactions, outlines exceptions, and explains special rules for notifiable transactions.

Key Points

Filing Duty: Taxpayers must submit an LTT return for every notifiable land transaction within 30 days following the transaction’s effective date. For chargeable transactions, the return must also include a self-assessment of the tax due.

Notifiable Transactions: These include major interests in land acquisitions, chargeable interests other than major interests where tax is due at more than 0%, and certain notional transactions.

Exceptions: Transactions exempt from charge, acquisitions under £40,000, and leases less than 7 years with chargeable consideration below the 0% threshold are not notifiable.

Special Rules: Substantial performance of contracts and specific arrangements involving public or educational bodies, partnership interests, and alternative property finance arrangements have unique notifiable transaction rules.

Self-Assessment Requirement: All chargeable transactions must include a self-assessment, even if the tax due is £0.00, due to claims for partial relief.

Contingent or Uncertain Consideration: Taxpayers can request deferral of tax on contingent or uncertain consideration, payable more than 6 months after the transaction’s effective date.

Deferral Requests: Must specify the deferred amount, provide a calculation, and propose an expected end date. The WRA can agree, adjust, or refuse these requests.

Declaration: Returns must include a declaration by the buyer or an authorised agent that the information provided is correct and complete.

Payment of Tax: Tax due must be paid by the filing date for the return. Amendments to returns requiring additional tax payments must be settled upon amendment submission or by the filing date, whichever is later.

Registration of Land Transactions: No land transaction can be registered without a WRA certificate, which is issued once the WRA is satisfied with the return’s completeness and the self-assessment’s accuracy.


The WRA’s guidance on LTT returns and payments is comprehensive, covering the process from determining notifiable transactions to the submission of returns and payment of tax. It emphasises the importance of timely and accurate compliance with LTT obligations for all land transactions in Wales.


LTT Appeals 

(LTT Land Transaction Tax)

➤ If you disagree with a Land Transaction Tax decision, you can request a review within 30 days; if unsatisfied with the review, appeal to a tax tribunal, but still likely need to pay the disputed tax.

 Understanding Land Transaction Tax: Disagreements and Appeals

  1. Requesting a Review

If you’re not satisfied with a tax decision, you can request a review. A review is an impartial examination of the decision by a WRA official who wasn’t involved in the original decision. Here’s how to initiate a review:

  • For Penalties: Use the WRA’s online form.
  • For Other Tax Decisions: Contact the WRA directly, either yourself or through an agent.

Deadline: You have 30 days from the decision letter to request a review. Late requests may still be considered.

Information Needed:

  • Your name or business name.
  • Case reference number.
  • Specific details of what you disagree with and why.
  • For penalties: issue date, your tax return filing date, and your reason for disputing the penalty.

Next Steps: Reviews typically conclude within 45 days. You’ll receive a letter with the outcome, which could affirm, amend, or cancel the original decision.

  1. Appealing to the Tribunal

If you’re dissatisfied with the review’s outcome, you can escalate the matter to the tax tribunal, an independent entity from the WRA.

Key Points to Remember:

  • Appeals must be lodged within 30 days of the review decision.
  • The tribunal offers a neutral platform to hear both sides before reaching a verdict.

When Reviews or Appeals Are Not Permissible

Certain situations may limit your ability to seek a review or appeal, particularly concerning the timing and nature of your dispute.

Paying Tax During the Dispute Process

You’re typically required to pay the contested tax amount during the review or appeal process, though this can vary based on individual circumstances and the type of tax involved.

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This Article Written By Nick Garner
Founder Stamp Duty Advice Bureau
Author of Stamp Duty Land Tax Guide
For Property Investors.