Land Transaction Tax threshold raised in Wales, Welsh Assembly
The Minister for Finance and Trefnydd, Rebecca Evans, has announced today, 14 July, changes to the Land Transaction Tax rates effective from 27 July 2020 until 31 March 2021 with the threshold lifted from £180,000 to £250,000.
The timing of the change ties up with further restrictions being removed from the housing market that currently prohibits the viewing of occupied residential properties.
With the main zero rate threshold being lifted, this will mean that 80 per cent of homebuyers will now not pay tax. It was previously at 60 per cent, with Wales being the only country in the UK that had a starting threshold higher than the average price of a home. The new threshold is £70,000 higher than their current starting threshold for residential property transactions and will mean that only around 20 per cent of those liable to the main LTT rates will pay any tax. Anyone buying properties that cost more than £250,000 will make a saving of £2,450 over that which would previously have been payable.
|PURCHASE PRICE||LTT RATE|
|Up to £250,000||0 per cent|
|Above £250,000 to £400,000||5 per cent|
|Above £400,000 to £750,000||7.5 per cent|
|Above £750,000 to £1,500,000||10 per cent|
|Over £1,500,000||12 per cent|
Higher rates transactions
The Welsh Government has, however, decided to make no changes to the rates and thresholds that apply to the higher rates of residential property transactions (HRAD for SDLT and ADS for LBTT).
Rebecca Evans, Minister for Finance and Trefnydd, said:
“These rates and thresholds have been set so they more closely reflect the property market in Wales and will ensure that we retain a progressive regime that expects those with the broadest shoulders to contribute a larger share in tax.”
Kindly shared by NAEA Propertymark