Land Transaction Tax (LTT) nil rate band extended in Wales
On 3 March 2021, the Welsh Government announced that the temporary increase to the nil rate band of Land Transaction Tax (LTT) for residential property transactions will be extended to 30 June 2021.
This means the nil band for transactions before 1 July 2021, will be up to and including £250,000. On and after 1 July 2021, the nil rate band will revert back to the £180,000 threshold.
Information from the Welsh Government says that there will not be any transitional rules. To this end, a transaction will need to complete before 1 July 2021 to use the temporary increase to the nil rate band.
Rebecca Evans MS, Minister for Finance and Trefnydd provided a written statement on the extension has currently resulted in only 25 per cent of those liable to the main LTT rates paying any tax at all. On average she said that people buying a home costing more than £250,000 have made a saving of £2,450 over that which would previously have been payable, and people buying homes costing less than £250,000 have not paid anything.
In the period August to January, Rebecca said that this targeted tax reduction has supported 10,000 taxpayers in Wales who were liable to the main rates of land transaction tax. These were, broadly, people buying their homes, and who may have needed additional support due to the pandemic. It has increased residential property transactions in 2020-21, from that which would otherwise have occurred, and had a positive effect on the housing market.
Daryl McIntosh, Propertymark Strategic Development Manager, said:
“By extending the LTT reduction period until 30 June 2021, those purchasing their main residential property will benefit from the savings, which will encourage buyer activity and help keep the residential property market prosperous. The measures also go some way into easing any immediate conveyancing or lenders issues that buyers have been experiencing over the intervening period. The pandemic has shone a light on where and how people want to live and the next government in Wales should look to do an impact assessment on COVID and housing need.”
Propertymark’s Property Support Package
Over the course of the pandemic, we have campaigned for an LTT/SDLT/LBTT holiday across the four nations of the UK and then promoted the benefits to consumers of extending the Stamp Duty holiday. We are pleased to hear that both the Welsh Government and the UK Government have listened to our campaign.
Property Sector Support Package
Kindly shared by NAEA Propertymark
Main photo courtesy of Pixabay
