Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017 section Schedule 2 paragraph 17

Second minimum amount

Schedule 2 paragraph 17 explains how to calculate the "second minimum amount" of consideration in pre-completion transactions, which acts as a floor for the chargeable consideration when land is transferred through one or more intermediate parties before the original contract is completed.

• The second minimum amount is the total of the net consideration given by all relevant parties — calculated for each party as the amount they paid out minus the amount they received from other relevant parties (but never less than zero).
• The relevant parties are normally just the original buyer and the transferee, but where there is a chain of successive pre-completion transactions, the rules expand to include additional transferors and transferees who are connected with or not acting at arm's length from the final transferee.
• Amounts paid or received by persons connected with a relevant party are treated as paid or received by that relevant party, although two persons who are both relevant parties are not treated as connected with each other for this purpose.
• Where the implemented transaction covers only part of the subject-matter of the original contract, the amounts attributed to the acquisition and to any preceding transactions must be apportioned on a just and reasonable basis.