Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017 section Schedule 4 paragraph 11

Construction works as consideration

Schedule 4, paragraph 11 deals with how construction, improvement, repair or other land-enhancing works are treated when they form all or part of the consideration for a land transaction, and the conditions under which such works may be excluded from chargeable consideration.

• Where construction, improvement, repair or other value-enhancing works form part of the consideration for a land transaction, those works may be excluded from chargeable consideration provided certain conditions are met.
• The three conditions are: the works must be carried out after the effective date, the works must be on land acquired under the transaction or other land held by the buyer or a connected person, and the seller or a connected person must not be contractually required to carry out the works.
• Where a contract or agreement for lease and its subsequent completion or grant create two notifiable transactions, the timing condition is treated as satisfied for the second transaction if it was satisfied for the first.
• The value of the works is their open market cost as at the effective date, including any VAT that would be chargeable, and special rules apply where arrangements involve public or educational bodies.