Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017 section Schedule 2 paragraph 16

First minimum amount for pre-completion transactions

Schedule 2 paragraph 16 sets out how to determine the "first minimum amount" used in calculating the consideration for land transaction tax purposes when a pre-completion transaction (such as an assignment of rights or a free-standing transfer) takes place before the original contract is completed.

• The default first minimum amount is the consideration agreed under the original contract for the property interest being acquired, or a just and reasonable proportion of it if only part of the property is involved.
• An alternative calculation applies when three conditions are met: the transaction is part of a chain of successive pre-completion transactions, a transferor in the chain is connected with (or not acting at arm's length from) a later transferee, and obtaining a tax advantage was not a main purpose of entering into the chain.
• When the alternative calculation applies, the first minimum amount is instead the consideration agreed under the transfer to the first connected or non-arm's length transferor in the chain, including any obligations of the transferor under that transfer.
• The concept of "tax advantage" used in Condition C has the same meaning as that used in the reliefs anti-avoidance provisions of the Act.

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