Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017 section Schedule 8 paragraph 5

Powers of appointment and trustee discretions

Schedule 8 paragraph 5 deals with how consideration is treated when a chargeable interest is acquired through the exercise of a power of appointment or through trustees exercising their discretion under a settlement.

• This provision applies where a chargeable interest is acquired through the exercise of a power of appointment or through the exercise of a discretion held by trustees of a settlement.
• If any payment or consideration was given in order for the recipient to become a potential beneficiary (an "object") of the power of appointment or the trustees' discretion, that payment counts as consideration for the land transaction.
• This rule prevents avoidance by ensuring that amounts paid to be included as a possible beneficiary are brought into charge as part of the land transaction tax calculation.
• The provision captures consideration given at any stage — not just at the point the interest is actually transferred, but also at the earlier stage when the person secures their position as someone who could benefit.