Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017 section Schedule 5 paragraph 17

Exception from higher rates: replacement of only or main residence

Schedule 5 paragraph 17 provides an exception from the higher rates of land transaction tax where a buyer is purchasing a replacement for their only or main residence, including provisions for extending the normal time limits where exceptional circumstances such as relevant restrictions or fire safety defects have caused delays.

• The higher rate charge does not apply where the new dwelling replaces the buyer's only or main residence, provided the previous home was sold within 3 years before or after the purchase and was used as the buyer's main home during that period.
• The standard 3-year window for selling the old home before buying can be extended if a relevant restriction (such as pandemic-related measures) substantially hindered the buyer's ability to purchase a replacement, provided the purchase takes place on or after 12 July 2024 and as soon as reasonably practicable.
• The standard 3-year window for selling the old home after buying can also be extended where a relevant restriction hampered the sale, or where the old home had a hidden fire safety defect that a third party (such as a landlord or developer) was responsible for remedying.
• The interests of a spouse or civil partner are taken into account when testing whether conditions are met, but only if the couple are living together at the relevant date; former spouses and former civil partners are also relevant when considering disposals after purchase.