Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017 section Schedule 5 paragraph 15

Higher rates condition for multiple dwelling transactions where buyer already owns another dwelling

Schedule 5, paragraph 15 sets out when the higher rates of land transaction tax apply to a transaction involving multiple dwellings, where only one is a qualifying dwelling and the buyer already holds an interest in another dwelling worth £40,000 or more.

• Higher rates apply where a buyer purchases multiple dwellings (only one being a qualifying dwelling) and already owns a major interest in another dwelling valued at £40,000 or more at the effective date of the transaction.
• The higher rates do not apply if the buyer's existing interest is a freehold reversion on a lease of more than 21 years held by someone not connected with the buyer.
• Where the buyer jointly owns the other dwelling, the £40,000 threshold is tested against the buyer's beneficial share only — calculated by reference to their percentage share (tenants in common) or an equal split among joint tenants, with spouses or civil partners living together being treated as a single owner for these purposes.
• Two specific exceptions can override this paragraph: the "interest in same main residence" exception and the "replacement of main residence" exception.

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