Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017

• “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);

• “public authority” (“awdurdod cyhoeddus”) means a person carrying out a function of a public nature;

• “relevant restriction” (“cyfyngiad perthnasol”) means a prohibition or restriction of any activity by an enactment, or by a public authority by virtue of an enactment, for the purpose of preventing, controlling or mitigating the effects of an emergency.

• (2) In sub-paragraph (1) “relevant restriction” does not include a prohibition or restriction that ceased to have effect before 12 July 2024.

SCHEDULE 21A

PART 1 — Key terms

Meaning of transaction land

1

In this Schedule, “transaction land”, in relation to a land transaction, means land a chargeable interest in which is the subject matter of the transaction.

Meaning of special tax site

2

In this Schedule, “special tax site” means the areas designated as special areas by—

• (a) the Designation of Special Tax Sites (Celtic Freeport) Regulations 2024 (S.I. 2024/1035) as made on 16 October 2024;

• (b) the Designation of Special Tax Sites (Anglesey Freeport) Regulations 2024 (S.I. 2024/1286) as made on 4 December 2024.

• (c) the Designation of Special Tax Sites (Anglesey Freeport) Regulations 2025 (S.I. 2025/1079) as made on 14 October 2025.

• (d) the Designation of Special Tax Sites (Flintshire and Wrexham Investment Zone) Regulations 2025 (S.I. 2025/1080) as made on 14 October 2025.

Meaning of qualifying land

3

For the purposes of this Schedule, transaction land is “qualifying land” if, on the effective date of the land transaction—

• (a) it is situated in a special tax site, and

• (b) the buyer intends it to be used exclusively in a qualifying manner.

Meaning of qualifying manner

4

• (1) For the purposes of this Schedule, transaction land is used in a qualifying manner if it is used in one or more of the following ways—

• (a) it is used by the buyer or a connected person in the course of a commercial trade or profession;

• (b) it is developed or redeveloped by the buyer or a connected person for use (by any person) in the course of a commercial trade or profession;

• (c) it is exploited by the buyer or a connected person, in the course of a commercial trade or profession, as a source of rents or other receipts (other than excluded rents).

• (2) But transaction land is not used in a qualifying manner to the extent that it is—

• (a) used as a dwelling or as the garden or grounds of a dwelling (including any building or other structure on such land),

• (b) developed or redeveloped to become residential property,

• (c) exploited as a source of rents or other receipts payable by a person using the land otherwise than in a qualifying manner, or

• (d) held (as stock of the business) for resale without development or redevelopment.

• (3) Despite sub-paragraph (2), transaction land is used in a qualifying manner to the extent it is used as a dwelling or as the garden or grounds of a dwelling that is provided to an individual and the individual’s family for the better performance of the individual’s employment duties as caretaker of, or as a member of the security staff for, the transaction land or any part of it.

• (4) For the purposes of this paragraph, use of land in the course of a commercial trade or profession includes use of land for a purpose that is ancillary to the use of other land which—

• (a) is situated in a special tax site, and

• (b) is being used, or developed or redeveloped, in the course of a commercial trade or profession.

• (5) The references in this paragraph to doing something in the course of a commercial trade or profession include doing something in the course of a property rental business.

• (6) In this paragraph—

• “commercial” (“masnachol”) in relation to a trade or profession, means carried on—on a commercial basis, andwith a view to profit;

• “excluded rents” (“rhenti wedi eu heithrio”) means income within any of classes 1 to 6 in the table in section 605(2) of the Corporation Tax Act 2010 (c. 4);

• “property rental business” (“busnes rhentu eiddo”) has the same meaning as a “property business” in the Income Tax (Trading and Other Income) Act 2005 (c. 5) (see section 263(6) of that Act).”

PART 2 — The Relief

Meaning of relief period

5

In this Part, the “relief period” means

• (a) in so far as the reference relates to the special tax site mentioned in paragraph 2(a), the period beginning with 26 November 2024 and ending with 30 September 2029;

• (b) in so far as the reference relates to the special tax site mentioned in paragraph 2(b), the period beginning with 23 January 2025 and ending with 30 September 2029;

• (c) in so far as the reference relates to the special tax site mentioned in paragraph 2(c), the period beginning with 21 November 2025 and ending with 30 September 2029.

• (d) in so far as the reference relates to the special tax site mentioned in paragraph 2(d), the period beginning with 21 November 2025 and ending with 30 September 2034.

Full relief

6

• (1) This paragraph applies if—

• (a) 100% of the chargeable consideration for a land transaction is attributable to qualifying land, and

• (b) the effective date of the transaction is within the relief period.

• (2) The land transaction is relieved from tax.

Partial relief

7

• (1) This paragraph applies if—

• (a) the proportion of the chargeable consideration for a land transaction attributable to qualifying land (“the relevant proportion”) is less than 100%, and

• (b) the effective date of the transaction is within the relief period.

• (2) The tax chargeable in respect of the land transaction is reduced by a proportion equivalent to the relevant proportion.

Attributing chargeable consideration to land

8

• (1) For the purposes of this Schedule, the consideration attributable to qualifying land must be determined on a just and reasonable basis.

• (2) Sub-paragraphs (3) and (4) apply if less than 100% of the chargeable consideration attributable to transaction land situated in a special tax site (“the tax site consideration”) is attributable to land that satisfies the condition in paragraph 3(b).

• (3) If at least 90% of the tax site consideration is attributable to land that satisfies the condition in paragraph 3(b), then, for the purposes of this Schedule, all of the tax site consideration is to be treated as being attributable to qualifying land.

• (4) If less than 10% of the tax site consideration is attributable to land that satisfies the condition in paragraph 3(b), then, for the purposes of this Schedule, all of the tax site consideration is to be treated as not being attributable to qualifying land.

Contract completed by transfer after the end of the relief period

9

• (1) This paragraph applies if—

• (a) a land transaction is treated as effected under section 10(4) as a result of a contract being substantially performed without having been completed,

• (b) that transaction is relieved from tax under paragraph 6 or 7, and

• (c) the contract mentioned in paragraph (a) is subsequently completed by a transfer after the end of the relief period.

• (2) Section 10(5)(b) does not apply in relation to the transaction mentioned in sub-paragraph (1)(c) if the sole reason that it would have applied (but for this paragraph) is that the transaction occurred after the end of the relief period.

• (3) In this paragraph, “completed”, “contract” and “transfer” are to be interpreted in accordance with section 10(10).

PART 3 — Withdrawal of relief

Withdrawal of relief

10

• (1) In this Part, a transaction that is relieved from tax under Part 2 is referred to as a “relieved transaction”; and accordingly references to a “buyer” and “qualifying land” are references to the buyer and the qualifying land in the relieved transaction.

• (2) Relief is withdrawn in relation to a relieved transaction if, at any time during the control period, the qualifying land is not used exclusively in a qualifying manner.

• (3) But the relief is not withdrawn where, because of a change in circumstances that is unforeseen and beyond the buyer’s control, it is not reasonable to expect the qualifying land to be used exclusively in a qualifying manner at that time.

• (4) Where, at a time during the control period, the use of all or part of the qualifying land in a qualifying manner has not yet begun, that land, or that part of the land, is to be treated as being used exclusively in a qualifying manner if reasonable steps are being taken to ensure that it is used in that manner.

• (5) Where, at a time during the control period, the use of all or part of the qualifying land in a qualifying manner has ceased, that land, or that part of the land, is to be treated as being used exclusively in a qualifying manner if reasonable steps are being taken—

• (a) to ensure that it is used in that manner, or

• (b) to dispose of all chargeable interests in that land, or that part of the land, that are held by the buyer and connected persons in a timely manner.

The control period

11

• (1) In this Schedule, the “control period”, in relation to a relieved transaction, means the shorter of—

• (a) the period of 3 years beginning with the effective date of that transaction, and

• (b) the period beginning with the effective date of that transaction and ending with the effective date of the final transaction.

• (2) For the purposes of this paragraph, a land transaction is the final transaction if, immediately after the effective date of the transaction, neither the buyer nor a connected person holds a chargeable interest in the qualifying land (whether as a result of that transaction alone or as a result of that transaction and other land transactions).

• (3) For the purposes of sub-paragraph (2), the buyer or a connected person is treated as not having a chargeable interest in the qualifying land if the market value of the chargeable interest in the qualifying land that the buyer or a connected person holds is less than £40,000, unless sub-paragraph (4) applies.

• (4) This sub-paragraph applies if—

• (a) the buyer and any connected person hold between them more than one chargeable interest in the qualifying land, and

• (b) the total market value of those chargeable interests is £40,000 or more.

Disposal of interest in part of qualifying land during control period

12

• (1) This paragraph applies where the buyer ceases to hold a chargeable interest in part of the qualifying land during the control period.

• (2) The references in paragraphs 10 and 11 to the qualifying land are to be treated as references only to the part of the qualifying land in relation to which the buyer still holds a chargeable interest (whether the chargeable interest acquired in the land transaction relieved from tax under Part 2 of this Schedule or another chargeable interest).

PART 4 — ALTERNATIVE FINANCE ARRANGEMENT

Alternative Property Finance

13

• (1) This paragraph applies where either of the following applies—

• (a) paragraph 2(1) of Schedule 10 (land sold to financial institution and leased to a person), or

• (b) paragraph 3(1) of Schedule 10 (land sold to financial institution and re-sold to a person).

• (2) This paragraph applies for the purposes of determining—

• (a) whether relief can be claimed under Part 2 of this Schedule for the first transaction, and

• (b) whether relief for the first transaction is withdrawn under Part 3 of this Schedule.

• (3) For those purposes, this Schedule has effect as if—

• (a) references to the buyer were references to the relevant person, and

• (b) the reference in paragraph 4(2)(d) to land held (as stock for the business) for resale without development or redevelopment were a reference to land held in that manner by the relevant person.

• (4) The first transaction does not qualify for relief under Part 2 of this Schedule except where it does so by virtue of this paragraph.

• (5) In this paragraph—

• “the first transaction” (“y trafodiad cyntaf”) has the same meaning as in paragraph 2 or 3 of Schedule 10 (as appropriate);

• “the relevant person” (“y person perthnasol”) means the person, other than the financial institution, who entered into the arrangements mentioned in paragraph 2 or 3 of Schedule 10 (as appropriate).

Circumstances in which subsidiary dwellings do not count as separate dwellings

7A

• (1) Sub-paragraph (3) applies in relation to a chargeable transaction—

• (a) where—

• (i) the buyer is an individual, and

• (ii) the main subject-matter of the transaction consists of a major interest in two or more dwellings (“purchased dwellings”),

• (b) where only one of the purchased dwellings is a qualifying dwelling, and

• (c) to which paragraph 15 of Schedule 5 does not apply.

• (2) But sub-paragraph (3) does not apply in relation to a chargeable transaction that—

• (a) is within sub-paragraph (1), and

• (b) to which paragraph 18 of Schedule 5 applies (intermediate transaction treated as a higher rates residential property transaction).

• (3) For the purposes of this Schedule, the interests in the qualifying dwelling mentioned in sub-paragraph (1)(b) and a purchased dwelling (or more than one) that is subsidiary to it are treated as if they were an interest in a single dwelling.

• (4) For the purposes of this paragraph, a purchased dwelling (“dwelling A”) is subsidiary to a qualifying dwelling (“dwelling B”) if dwelling A would be subsidiary to dwelling B for the purposes of Schedule 5 (see paragraph 14 of that Schedule).

• (5) In this paragraph, “qualifying dwelling” means a dwelling that is a qualifying dwelling for the purposes of Part 3 of Schedule 5 (see paragraph 13 of that Schedule).

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 5th 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.

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 5th 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 5th 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.

Subsequent disposal to local authorities exception: transaction involving multiple dwellings

21A

• (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 5th 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.