When buying a residential property or a piece of land in Wales you pay the government something called a Land Transaction Tax (LTT). This tax applies on all freehold and leasehold sales, with or without a mortgage.
For anyone buying a property in Wales, LTT may need to be paid when purchasing a property over £225,000. LTT replaced the Stamp Duty Land Tax in Wales in April 2018 and is collected and managed by WRA, with the tax collected being utilised to help support Welsh public services.
This tax applies if you are buying your first home or if you are buying your main residential home, regardless of if you have owned a home before. However, if you are buying an additional property, for example as a buy-to-let investment, then a different LTT rate applies to that property. For a second home or some buy-to-let purchases, you will pay a higher residential LTT for purchases costing more than £40k.
Land Transaction Tax Rates
| Minimum property purchase price | Maximum property purchase price | Stamp Duty rate (only applies to the part of the property price falling within each band) |
| £0 | £225,000*** | 0% |
| £225,001 | £400,000 | 6% |
| £400,001 | £750,000 | 7.5% |
| £750,001 | £1,500,000 | 10% |
| £1,500,001 + | 12% |
Land Transaction Tax on second homes
If you own one property and are looking to purchase another, there are higher fees to pay on second homes which are as follows:
| Minimum property purchase price | Maximum property purchase price | Stamp Duty rate (only applies to the part of the property price falling within each band) |
| £0 | £180,000*** | 4% |
| £180,001 | £250,000 | 7.5% |
| £250,001 | £400,000 | 9% |
| £400,001 | £750,000 | 11.5% |
| £750,001 | £1,500,000 | 14% |
| £1,500,001 + | 16% |
Your solicitor will usually organise the payment of the Land Transaction Tax to the Welsh Revenue Authority as part of the purchase process. If you choose to do this yourself you must submit the returns form and payment within 30 days of the day after completion. Failure to do this within the deadline may result in fines from the Welsh Revenue Authority. Even if there is no LTT to pay you must still submit a returns form (unless exempt) to the Authority, for their records.
Multiple Dwellings Relief
This relief is available when you buy a number of dwellings in Wales from the same seller either in a single transaction, with the same effective date, or in a number of linked transactions (transactions are linked where they form part of a single scheme, arrangement, or series of transactions between the same buyer and seller or persons connected to them). It usually sees the LTT charged on the sale price divided by the number of properties purchased, regardless of the size or value of them and can lead to significant savings and is most certainly worth investigating further should you be looking to purchase a property with additional, separate accommodation. Full details can be found here and should be discussed further with your accountant, to find out if the property you are looking to purchase could benefit from this saving.
Differences across the UK
- In Wales, buyers pay the Welsh Revenue Authority a Land Transaction Tax (LTT) and rates and bands vary.
- In England and Northern Ireland, buyers pay the Government a Stamp Duty Land Tax (SDLT) and the bands and rates are different to the ones in Wales.
- In Scotland, buyers pay the Scottish Government a Land and Building Transaction Tax (LBTT).
Further Information
To calculate your LTT please visit the Welsh Revenue Authority’s LTT calculator page HERE.
In England and Northern Ireland, the Government has recently (1st April 2021) changed its rules for overseas buyers. For the first time, we will see investors from overseas, so people who are non-UK residents, have to pay a 2% stamp duty surcharge. It will apply to all residential property purchases and on rents on the grant of a new lease. Also, some UK resident firms, that are controlled by non-UK residents, will be liable. For more information visit the Government’s site here.
***UPDATE – As of the 10th of October 2022 the thresholds for paying LTT will change. We have updated the tables above to reflect these new rates.***
There was a reduced rate on paying the LTT until the 30th of June 2021, which meant if you bought a house or land before that date you paid zero tax on the first £250k on residential properties and £225k for non-residential properties and land.
Properties over this threshold had to pay tax at varying rates depending on the value of the property.