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Welsh Government Announces Changes to Land Transaction Tax

Posted by: CJCH Solicitors | 12th December 2024

The Welsh Government has recently announced significant changes to rates for the Land Transaction Tax (LTT) as part of its draft budget for 2025 to 2026.

These new rates primarily impact residential property transactions in Wales operating at a higher rate. The new rates are impactful, with taxation rates as high as 17% for the highest portion of properties valued over £1,500,000.

The changes are as follows:

  • The portion up to and including £180,000 – 5%
  • The portion over £180,000 up to and including £250,000 – 8.5%
  • The portion over £250,000 up to and including £400,000 – 10%
  • The portion over £400,000 up to and including £750,000 – 12.5%
  • The portion over £750,000 up to and including £1,500,000 – 15%
  • The portion over £1,500,000 – 17%

            You will be subject to the higher rate of LTT when both of the following apply:-

            • You buy a residential property worth £40,000 or more; and
            • You already own one or more other properties

            You will not usually pay higher rates if:

            • You use your new property as your main home and have sold the last main home you owned before you buy your new home (or on the same day)
            • Any of the following apply to the property you’re buying:
              • it’s worth less than £40,000
              • it’s a mixture of residential and non-residential space (like a shop with a flat above it)
              • it’s ‘moveable’ like a caravan, houseboat or mobile home
              • it’s a freehold property with a lease on it that has more than 21 years left, held by someone unconnected to you

            These changes apply to transactions made on or after December 11, 2024. For those who exchanged contracts before December 10, 2024, but completed the purchase on or after this date, in most cases, the previous rates can still be used.

            To assist people in working out the new tax rates, the Welsh Government has provided a useful Land Transaction Tax (LTT) calculator on its website. This tool uses your property’s relevant details to calculate the precise amount of tax due based on the new rates.

            The CJCH team remains dedicated to helping you navigate through these changes. If you have any questions about the recent changes to the Land Transaction Tax or need assistance in understanding how it impacts your property transactions, please get in touch with us at CJCH.

            Moving forward in the property market with knowledge and understanding is paramount now more than ever. Reach out to us today, and let’s navigate the changes together.

            Contact the CJCH Team for any questions.

            Email: admin@cjch.co.uk  or call 0333 231 6405