New Stamp Duty regime in Wales - Land Transaction Tax

Land Transaction Tax Rates and Bands

The current residential rates for the existing Stamp Duty taxation in the UK is that no tax is paid on residential properties purchased up to a value of £125,000 with a 2% rate then applying to the value of a property between £125,000 to £250,000 and 5% for the value between £250,000 and £925,000.

For example if you purchase a house for £200,000 (and you were not a first time buyer) then you would pay the following Stamp Duty under the current regulations: –

  1. £0 to £125,000 at 0% = £0

  2. £125,000 to £200,000 (£75,000) at 2% = £1500

Total Stamp Duty payable £1500

This is on the basis that the property you are purchasing is your primary residence and it does not take into account the higher rate charges for second homes.

The new Land Transaction Tax rates revise this structure for Stamp Duty as follows: –

  1. Up to £180,000 – No tax

  2. Between £180,000 and £250,000 – 3.5%

  3. Between £250,000 and £400,000 – 5%

  4. Between £400,000 and £750,000 – 7.5%

  5. Between £750,000 and £1.5 million – 10%

  6. Above £1.5 million – 12%

Using the same example as above if you were to purchase a property in Wales as your primary residence for £200,000 the Land Transaction Tax would now be as follows: –

  1. £0 to £180,000 at 0% = £0

  2. £180,000 to £200,000 (£20,000) at 3.5% = £700

Total Land Transaction Tax payable £700

The move is thought to benefit first time buyers in Wales as the average house price as of July 2016 for Wales is £145,000 which would mean that the average house price will now be below the threshold for paying Stamp Duty. Those who are purchasing properties in excess of £250,000 are, however, likely to lose out as they will be paying 1.5% higher than the rates in England up to £400,000. First time buyers will also be significantly better off in England after 1st April 2018 and the stamp duty rate will continue to be at 0% for purchases up to £300,000 (compared to up to £180,000 in Wales)

At present the Welsh Assembly Government have stated that the additional 3% charge that applies to the existing Stamp Duty Land Tax regime in England and Wales will continue to apply to people purchasing additional residential properties in Wales from the 1st April 2018 onwards.

If you have any queries about the new Land Transaction Tax regime or would like further information please contact our offices on 01654 711499 or email

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