How much tax will you have to pay when buying a property in the Wales?
I am a first-time buyerProperty is a buy to let or second home
Based on a property / land value of , there will be Stamp Duty due.
| Band | Rate | Taxable Sum | Tax |
|---|---|---|---|
| less than £180k | 0% | 3% | £0 |
| £180,000 to £250,000 | 3.5% | 6.5% | |
| £250,000 to £400,000 | 5% | 8% | |
| £400,000 to £750,000 | 7.5% | 10.5% | |
| £750,000 to £1.5m | 10% | 13% | |
| rest over £1.5m | 12% | 15% | |
| Effective Rate | {{model.effective}}% | LTT Tax: |
What is Land Transaction Tax and how is it calculated?
The new LTT system was announced by the Welsh Government in the October 2017 Budget and came into force in April 2018.
LTT is payable when you buy or lease a building or land over a certain price. The new LTT taxation system is broadly consistent with the existing SDLT structure in England and Northern Ireland.
The changes are designed to make the new tax fairer, improve taxation effectiveness and to enable a focus on Welsh needs and priorities.
For a normal purchase LTT is exempt on the first £180,000. Between £180,000 and £250,000 buyers will pay 3.5% within this band, 5% on the portion between £250,000 and £400,000, 7.5% on the portion between £400,000 and £750,000, 10% within the next band up to £1.5 million and 12% over that. For additional property, such as buy to let or second homes, there will be a 4% surcharge applied to all bands.
What are the new LTT rates in Wales?
The new LTT rates in Wales are shown in the table below
| Tax Band | Normal Rate | Additional Property |
|---|---|---|
| less than £180k | 0% | 4%* |
| £180k to £250k | 3.5% | 7.5% |
| £250k to £400k | 5% | 9% |
| £400k to £750k | 7.5% | 11.5% |
| £750k to £1.5m | 10% | 14% |
| rest over £1.5m | 12% | 16% |
* Under the current LTT system an additional property purchased for less than £40k will attract 0% tax. For purchases from £40k to £180k the LTT rate will be 4% on full purchase price. | ||
For a normal purchase LTT is exempt on the first £180,000. Between £180,000 and £250,000 buyers will pay 3.5% within this band, 5% on the portion between £250,000 and £400,000, 7.5% on the portion between £400,000 and £750,000, 10% within the next band up to £1.5 million and 12% over that. For additional property, such as buy to let or second homes, there will be a 3% surcharge applied to all bands.
Full details including LTT rates for non residential property can be found on our LTT rates page.
LTT for buy to let and second homes
Under the new LTT system a 4% surcharge applies to all transactions involing the purchase of an additional property. Additional property types include buy to let investments and second homes. In line with the rest of the UK, the surcharge applies to the full purchase price above an initial threshold of £40,000.
Please refer to our LTT second homes page for more information.
LTT for first time buyers
Specific first time buyer relief is not currently available under the new LTT system but the higher zero tax threshold of £180k should capture most first time purchases.
How much LTT will be payable?
The LTT calculators below indicate how much tax is payable for both single and additional freehold residential property purchases in Wales. The Figures are valid from April 2018.
Need some more help with working out how much tax you'll need to pay? Get in touch today for a call back!