Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017 section Schedule 4 paragraph 17

Costs borne by the buyer under section 9(4) of the Leasehold Reform Act 1967 or section 33 of the Leasehold Reform, Housing and Urban Development Act 1993 (costs of enfranchisement)

Schedule 4 paragraph 17 confirms that certain costs a buyer must pay during the leasehold enfranchisement process are excluded from chargeable consideration for land transaction tax purposes.

• When a leaseholder exercises the right to buy the freehold of their property (enfranchisement), they are often required by law to pay certain costs incurred by the landlord
• These costs typically include the landlord's legal fees, valuation fees, and other reasonable expenses arising from the enfranchisement process
• Under this provision, such costs borne by the buyer do not count as chargeable consideration, meaning they are not included in the amount on which land transaction tax is calculated
• This exclusion applies to enfranchisement costs arising under both the Leasehold Reform Act 1967 (which covers houses) and the Leasehold Reform, Housing and Urban Development Act 1993 (which covers flats)