Key elements to remember in updated technical guidance.
The technical guidance covering land transaction taxes in Wales, including alternative property finance relief, has been updated. It is important to remember some of the basic conditions on the second property rules that apply for a residential dwelling, which includes dwellings both in Wales and elsewhere in the world where the chargeable consideration given for that major interest is £40,000 or more.
Key elements to remember are:
- a dwelling for the purposes of the higher rates will include holiday homes and properties let as furnished holiday lettings (including those that have restricted occupation which prevent the dwelling from being occupied all year round, and properties such as holiday park lodges)
- the garden or grounds and any buildings on the garden or grounds are part of the dwelling, to the extent they are considered to be residential property for the purposes of LTTA, and the consideration given for these will also be liable to the higher rates
- if non-residential land is owned on which the taxpayer is seeking, or has obtained, planning permission to convert to residential, that major interest in the land is not treated as an interest in a dwelling until construction or adaptation actually commences. The seeking or obtaining of planning permission falls short of the process of construction or adaptation for use as a dwelling. However, in the event that such a property was sold once construction or adaptation has commenced, if the other conditions for LTT higher rates to apply to the transaction are present, the acquisition by the buyer would be liable to the LTT higher rates.
You can view the specific guidance now
Article from ACCA In Practice