The Welsh government has published a consultation seeking views on possible changes to the rules for land transaction tax (LTT). LTT may be charged where a person buys an interest in land in Wales. LTT replaced stamp duty land tax (SDLT) in Wales from April 2018.  

The Welsh government is proposing to abolish multiple dwellings relief (MDR). MDR reduces the person’s liability to LTT when they buy more than one dwelling from the same seller in certain circumstances.  

The UK government announced at the Spring Budget 2024 that MDR will be abolished for SDLT from 1 June 2024. It is proposed that MDR will be abolished for LTT purposes at the same time or as soon as possible thereafter, subject to similar transitional rules as apply for SDLT. The subsidiary dwelling exception, a special form of relief available in certain multiple-dwelling transactions, will remain.   

Alongside the abolition of MDR, the Welsh government is considering abolishing the relief provided on the purchase of six or more dwellings in a single transaction. The current rules allow the purchaser to choose between treating the transaction as:  

• non-residential, paying LTT at the non-residential rates; or 
• residential, paying LTT at the higher residential rates and possibly claiming MDR.  

The Welsh government proposes extending the existing LTT relief for registered social landlords to Welsh local authorities purchasing property for social housing purposes.  The Welsh government has also asked if any other LTT rules, including reliefs, should be considered for review.  

The Welsh government states that responses to the consultation will support its consideration of the costs, benefits and wider impact of the proposals. This includes social, cultural, economic and environmental well-being, socio-economic disadvantage and the Welsh language. 

The closing date for comments is 19 May 2024.  If you have comments on the proposals that could contribute to a response from ICAEW, please contact Lindsey Wicks.