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

Ownership of another dwelling worth £40,000 or more

Schedule 5, paragraph 5 explains when a buyer's existing ownership of another dwelling triggers the higher rates of land transaction tax, and how to value that interest when the buyer shares ownership with others.

• The higher rates apply where, on the effective date of the transaction, the buyer holds a major interest in a dwelling other than the one being purchased, and that interest is worth £40,000 or more.
• An exception exists where the other interest is a freehold reversion on a lease of more than 21 years that is not held by a person connected with the buyer — in that case, the higher rates are not triggered.
• Where the buyer shares ownership with others, only the buyer's proportionate share counts towards the £40,000 threshold — calculated either by percentage share (tenants in common) or by dividing equally among joint tenants.
• Spouses and civil partners who are living together are treated as a single unit for these purposes: their combined share is assessed together when they are tenants in common, and they count as one joint tenant when they hold as joint tenants.