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Welsh government announces Land Transaction Tax changes

Chris Littlewood BA (Hons), ACCA
Client Manager

Following the Government’s mini budget announcement that stamp duty land tax (SDLT) would be cut significantly, the Welsh government has responded by announcing changes to Land Transaction Tax (LTT).

The Welsh Government has announced the threshold for paying Land Transaction Tax (LTT) is being increased from £180,000 to £225,000 with the change coming into force on 10 October 2022.

“The Welsh government's aim is to align LTT thresholds for paying taxes to the rising prices of homes.”

The main residential Land Transaction Tax (LTT) from 10 October 2022:

  • the nil rate band will increase to £225,000 (currently £180,000);

  • Previously, a rate of 3.5% applied between £180,000 and £250,000 and 5% between £250,000 and £400,000.

  • From 10 October 2022, a rate of 6% will apply between £225,000 and £400,000.

There are no changes to the higher rate of Land Transaction Tax that property investors pay at present on additional properties.

Main residential LTT rates from 10 October 2022

Price thresholdLTT rate
£0 - £225,0000%
£225,000 - £400,0006%
£400,000 - £750,0007.5%
£750,000 - £1,500,00010%
over £1,500,00012%

Higher residential LTT rates for buy-to-let

Individuals pay higher LTT rates when both of the following apply:

  • you buy a residential property worth £40,000 or more, and

  • you already own 1 or more other properties

Companies pay higher LTT rates when residential property is purchased:

  • with a value of £40,00 or more;

  • or an interest in a lease of more than 21 years left is purchased

Price thresholdHigher LTT rate (for second properties)
up to and including £225,0004%
over £225,000 up to and including £400,00010%
over £400,000 up to and including £750,00011.5%
over £750,000 up to and including £1,500,00014%
over £1,500,00016%

More information on Land Transaction Tax can be found here.

Expert Guide: stamp duty for buy to let landlordsWritten by our expert property accountants.

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Chris Littlewood BA (Hons), ACCA
Client Manager

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