Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017 section Schedule 17 para 3

Acquisition relief

Schedule 17, paragraph 3 provides a relief known as "acquisition relief" that limits the land transaction tax payable when a company acquires all or part of the undertaking of another company, provided certain conditions are met.

• When a company acquires all or part of another company's undertaking and meets the required conditions, the LTT charge on any land transaction connected with the transfer is capped at 0.5% of the chargeable consideration (the Welsh Ministers may vary this rate by regulations).
• The consideration for the acquisition must consist wholly or partly of the issue of non-redeemable shares in the acquiring company to the target company or its shareholders; any remaining consideration may only be cash up to 10% of the nominal value of those shares, the assumption or discharge of the target company's liabilities, or both.
• The acquiring company must not be associated with another company that is party to arrangements with the target company concerning shares of the acquiring company issued in connection with the transfer — where "associated" means one controls the other or both are controlled by the same person(s), applying the control tests in sections 450 and 451 of the Corporation Tax Act 2010.
• The undertaking or part being acquired must have as its main activity the carrying on of a trade that does not consist wholly or mainly of dealing in chargeable interests (i.e. land and property interests).