The Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017 (Amendments to Schedule 5) Regulations 2026

“Subsequent disposal to local authorities exception: buyer is an individual in a single dwelling transaction

9A.

(1)

This paragraph applies to a transaction (“the acquisition transaction”)—

(a)

that is a higher rates residential property transaction under paragraph 3,

(b)

the effective date of which is during the period beginning with 13 February 2026 and ending with 31 March 2031, and

(c)

the chargeable consideration for which is £400,000 or less.

(2)

The acquisition transaction ceases to be a higher rates residential property transaction under paragraph 3 if—

(a)

in another transaction (“the disposal transaction”) the buyer in the acquisition transaction grants a lease of the purchased dwelling (“the leased dwelling”) to a local authority,

(b)

the lease is for a term of at least 5 years but not more than 20 years,

(c)

the rent payable under the lease is no greater than the maximum local housing allowance applicable at the effective date of the disposal transaction in respect of the leased dwelling, and

(d)

the effective date of the disposal transaction is during the period of 18 months beginning with the effective date of the acquisition transaction.

(3)

If the lease granted in the disposal transaction is terminated by the buyer in the acquisition transaction before the 5^th anniversary of the effective date of the disposal transaction, sub-paragraph (2) is treated as if it never applied to the acquisition transaction.

(4)

For further provision in connection with—

(a)

a transaction to which sub-paragraph (2) applies, see paragraph 23A;

(b)

a transaction to which sub-paragraph (3) applies, see paragraph 23B.

(5)

For the purposes of sub-paragraph (2), paragraph 20(1) of Schedule 6 (agreement for lease that is substantially performed is treated as a grant of a lease) does not apply.”

“(6)

This paragraph applies subject to the exception in paragraph 18A (subsequent disposal to local authorities exception).”

“Subsequent disposal to local authorities exception: multiple dwelling transactions

18A.

(1)

This paragraph applies to a transaction (“the acquisition transaction”)—

(a)

that is a higher rates residential property transaction under paragraph 11, and

(b)

the effective date of which is during the period beginning with 13 February 2026 and ending with 31 March 2031.

(2)

Sub-paragraph (4) applies to the acquisition transaction if—

(a)

in another transaction (“the disposal transaction”) the buyer in the acquisition transaction grants a lease of one or more of the purchased dwellings that consisted of the main subject-matter of the acquisition transaction (“leased dwelling”) to a local authority,

(b)

the chargeable consideration attributable to the leased dwelling or each leased dwelling (as the case may be) is £400,000 or less,

(c)

the lease is for a term of at least 5 years but not more than 20 years,

(d)

the rent payable under the lease is no greater than the maximum local housing allowance applicable at the effective date of the disposal transaction in respect of the leased dwelling or each leased dwelling (as the case may be), and

(e)

the effective date of the disposal transaction is during the period of 18 months beginning with the effective date of the acquisition transaction.

(3)

For the purpose of sub-paragraph (2)(b), the chargeable consideration attributable to a leased dwelling is so much of the chargeable consideration for the acquisition transaction that is attributable, on a just and reasonable basis, to the interest in that leased dwelling.

(4)

The tax chargeable in respect of the acquisition transaction is reduced by the relevant amount.

(5)

If the disposal transaction is the grant of a lease of a single leased dwelling, the “relevant amount” is the difference between—

(a)

the tax that would have been chargeable under section 27 in respect of the interest in the leased dwelling had it been the main subject-matter of a separate chargeable transaction (“the notional transaction”) that was a higher rates residential property transaction for the purposes of regulations under section 24(1)(b), and

(b)

the tax that would have been chargeable under section 27 on the same notional transaction were it a residential property transaction for the purposes of regulations under section 24(1)(a).

(6)

If the disposal transaction is the grant of a lease of more than one leased dwelling, the “relevant amount” is the difference between—

(a)

the sum of the amounts of tax that would have been chargeable under section 27 in respect of the interest in each leased dwelling had each interest been the main subject-matter of separate chargeable transactions (“the notional transactions”) and each notional transaction were a higher rates residential property transaction for the purposes of regulations under section 24(1)(b), and

(b)

the sum of the amounts of tax that would have been chargeable under section 27 on the same notional transactions were they residential property transactions for the purposes of regulations under section 24(1)(a).

(7)

For the purposes of determining the tax that would have been chargeable under sub-paragraphs (5)(a) and (5)(b) or (6)(a) and (6)(b) (as the case may be), the chargeable consideration for a notional transaction is the amount determined under sub-paragraph (3) in respect of the leased dwelling the interest in which is treated as being the main subject-matter of the notional transaction.

(8)

If the lease granted in the disposal transaction is terminated by the buyer in the acquisition transaction before the 5^th anniversary of the effective date of the disposal transaction, sub-paragraph (4) is treated as if it never applied to the acquisition transaction.

(9)

For further provision in connection with—

(a)

a transaction to which sub-paragraph (4) applies, see paragraph 23A;

(b)

a transaction to which sub-paragraph (8) applies, see paragraph 23B.

(10)

For the purposes of sub-paragraph (2), paragraph 20(1) of Schedule 6 (agreement for lease that is substantially performed is treated as a grant of a lease) does not apply.”

“Subsequent disposal to local authorities exception: transaction involving a dwelling

20A.

(1)

This paragraph applies to a transaction (“the acquisition transaction”)—

(a)

that is a higher rates residential property transaction under paragraph 20,

(b)

the effective date of which is during the period beginning with 13 February 2026 and ending with 31 March 2031, and

(c)

the chargeable consideration for which is £400,000 or less.

(2)

The acquisition transaction ceases to be a higher rates residential property transaction under paragraph 20 if—

(a)

in another transaction (“the disposal transaction”) the buyer in the acquisition transaction grants a lease of the purchased dwelling (“the leased dwelling”) to a local authority,

(b)

the lease is for a term of at least 5 years but not more than 20 years,

(c)

the rent payable under the lease is no greater than the maximum local housing allowance applicable at the effective date of the disposal transaction in respect of the leased dwelling, and

(d)

the effective date of the disposal transaction is during the period of 18 months beginning with the effective date of the acquisition transaction.

(3)

If the lease granted in the disposal transaction is terminated by the buyer in the acquisition transaction before the 5^th anniversary of the effective date of the disposal transaction, sub-paragraph (2) is treated as if it never applied to the acquisition transaction.

(4)

For further provision in connection with—

(a)

a transaction to which sub-paragraph (2) applies, see paragraph 23A;

(b)

a transaction to which sub-paragraph (3) applies, see paragraph 23B.

(5)

For the purposes of sub-paragraph (2), paragraph 20(1) of Schedule 6 (agreement for lease that is substantially performed is treated as a grant of a lease) does not apply.”

“(5A)

This paragraph applies subject to paragraph 21A (subsequent disposal to local authorities exception).”

“21A.Subsequent disposal to local authorities exception: transaction involving multiple dwellings

(1)

This paragraph applies to a transaction (“the acquisition transaction”)—

(a)

that is a higher rates residential property transaction under paragraph 21, and

(b)

the effective date of which is during the period beginning with 13 February 2026 and ending with 31 March 2031.

(2)

Sub-paragraph (4) applies to the acquisition transaction if—

(a)

in another transaction (“the disposal transaction”) the buyer in the acquisition transaction grants a lease of one or more of the purchased dwellings that consisted of the main subject-matter of the acquisition transaction (“leased dwelling”) to a local authority,

(b)

the chargeable consideration attributable to the leased dwelling or each leased dwelling (as the case may be) is £400,000 or less,

(c)

the lease is for a term of at least 5 years but not more than 20 years,

(d)

the rent payable under the lease is no greater than the maximum local housing allowance applicable at the effective date of the disposal transaction in respect of the leased dwelling or each leased dwelling (as the case may be), and

(e)

the effective date of the disposal transaction is during the period of 18 months beginning with the effective date of the acquisition transaction.

(3)

For the purpose of sub-paragraph (2)(b), the chargeable consideration attributable to a leased dwelling is so much of the chargeable consideration for the acquisition transaction that is attributable, on a just and reasonable basis, to the interest in that leased dwelling.

(4)

The tax chargeable in respect of the acquisition transaction is reduced by the relevant amount.

(5)

If the disposal transaction is the grant of a lease of a single leased dwelling, the “relevant amount” is the difference between—

(a)

the tax that would have been chargeable under section 27 in respect of the interest in the leased dwelling had it been the main subject-matter of a separate chargeable transaction (“the notional transaction”) that was a higher rates residential property transaction for the purposes of regulations under section 24(1)(b), and

(b)

the tax that would have been chargeable under section 27 on the same notional transaction were it a residential property transaction for the purposes of regulations under section 24(1)(a).

(6)

If the disposal transaction is the grant of a lease of more than one leased dwelling, the “relevant amount” is the difference between—

(a)

the sum of the amounts of tax that would have been chargeable under section 27 in respect of the interest in each leased dwelling had each interest been the main subject-matter of separate chargeable transactions (“the notional transactions”) and each notional transaction were a higher rates residential property transaction for the purposes of regulations under section 24(1)(b), and

(b)

the sum of the amounts of tax that would have been chargeable under section 27 on the same notional transactions were they residential property transactions for the purposes of regulations under section 24(1)(a).

(7)

For the purposes of determining the tax that would have been chargeable under sub-paragraphs (5)(a) and (5)(b) or (6)(a) and (6)(b) (as the case may be), the chargeable consideration for a notional transaction is the amount determined under sub-paragraph (3) in respect of the leased dwelling the interest in which is treated as being the main subject-matter of the notional transaction.

(8)

If the lease granted in the disposal transaction is terminated by the buyer in the acquisition transaction before the 5^th anniversary of the effective date of the disposal transaction, sub-paragraph (4) is treated as if it never applied to the acquisition transaction.

(9)

For further provision in connection with—

(a)

a transaction to which sub-paragraph (4) applies, see paragraph 23A;

(b)

a transaction to which sub-paragraph (8) applies, see paragraph 23B.

(10)

For the purposes of sub-paragraph (2), paragraph 20(1) of Schedule 6 (agreement for lease that is substantially performed is treated as a grant of a lease) does not apply.”

“Further provision in connection with subsequent disposal to local authorities exception

23A.

(1)

This paragraph applies where—

(a)

an acquisition transaction (within the meaning of paragraph 9A(1) or 20A(1) (as the case may be)) ceases to be a higher rates residential property transaction for the purpose of regulations under section 24(1)(b) by reason of paragraph 9A(2) or 20A(2) (as the case may be), or

(b)

the tax chargeable in respect of an acquisition transaction (within the meaning of paragraph 18A(1) or 21A(1) (as the case may be)) is reduced by reason of paragraph 18A(4) or 21A(4) (as the case may be).

(2)

Sub-paragraph (3) applies where—

(a)

the effective date of the disposal transaction (within the meaning of paragraph 9A(2)(a), 18A(2)(a), 20A(2)(a) or 21A(2)(a) (as the case may be)) falls on or before the filing date for the return in respect of the acquisition transaction (within the meaning of paragraph 9A(1), 18A(1), 20A(1) or 21A(1) (as the case may be)), and

(b)

the return has not been made.

(3)

The buyer may not, when making the return in respect of the acquisition transaction—

(a)

treat the transaction as though it had never been a higher rates residential property transaction by virtue of paragraph 9A(2) or 20A(2) (as the case may be);

(b)

treat the tax chargeable in respect of the transaction as though it had always been reduced by virtue of paragraph 18A(4) or 21A(4) (as the case may be).

(4)

Sub-paragraph (5) applies where—

(a)

the effect of the acquisition transaction (within the meaning of paragraph 9A(1) or 20A(1) (as the case may be)) ceasing to be a higher rates residential transaction is that less tax is payable in respect of it than the buyer has already paid in accordance with a return made for that transaction, or

(b)

the effect of the tax chargeable in respect of the acquisition transaction (within the meaning of paragraph 18A(1) or 21A(1) (as the case may be)) being reduced is that less tax is payable in respect of it than the buyer has already paid in accordance with a return made for that transaction.

(5)

In order to obtain a repayment of the amount of tax overpaid the buyer—

(a)

may not amend the return made in respect of the acquisition transaction, but

(b)

may make a claim for repayment of the amount overpaid in accordance with Chapter 7 of Part 3 of TCMA.

(6)

Nothing in sub-paragraph (5) prevents the buyer from amending the return for any other purpose.

(7)

For the purposes of sub-paragraph (5)(b), section 78 of TCMA applies as if for “4 years” to the end there were substituted “12 months beginning with the effective date of the disposal transaction (within the meaning of paragraph 9A, 18A, 20A or 21A (as the case may be) of Schedule 5 to the LTTA).”

23B.

(1)

This paragraph applies where—

(a)

the buyer in an acquisition transaction (within the meaning of paragraph 9A(1), 18A(1), 20A(1) or 21A(1) (as the case may be)) has made a claim for repayment of an amount overpaid in accordance with paragraph 23A, and

(b)

paragraph 9A(3), 18A(8), 20A(3) or 21A(8) (as the case may be) applies.

(2)

The buyer must make a further return to the WRA.

(3)

A return made under this paragraph must—

(a)

be made before the end of the period of 30 days beginning with the day after the relevant date, and

(b)

include a self-assessment.

(4)

The “relevant date” is the date that the lease mentioned in paragraph 9A(3), 18A(8), 20A(3) or 21A(8) (as the case may be) is terminated.”

““local authority” (“awdurdod lleol”) means a council of a county or county borough constituted under section 21 of the Local Government Act 1972 (c. 70);”;

““local housing allowance” (“lwfans tai lleol”)means the allowance determined in accordance with paragraph 2 of Schedule 3B to the Rent Officers (Housing Benefit Functions) Order 1997 (S.I. 1997/1984);”.