Land Transaction Tax changes

housebuyer143

Only the Welsh government could make this into a positive thing 😆🤦‍♀️ 
Percentage increased to 6% from 5% and the band lowered to get more people into the higher band.

40% of the population screwed 😂

t1redmonkey

I don't think it's as bad as you might initially think.  Removed the tax entirely from purchases up to the value of £225k (there is still a lot of property in Wales below that amount so will benefit a lot on lower incomes). 

Also, you are maybe reading it or thinking about it slightly wrong, because you also end up paying less tax beyond £225k in the new system as well - up to £345k.  E.g. House for £275k under existing system = £3700 tax, under new system = £3000 tax.

ahon2010

So we're about to exchange but complete after 10th October, which is when the new rates start. Can anyone help explain exactly what the "transitional rules" mean?

It states, "Transitional rules will be introduced to ensure taxpayers who have exchanged contracts before the regulations making the changes come into force will be protected from any tax increase.".

From gov.wales/land-transaction-tax-rates-and-bands

Any help greatly appreciated.

SDLT_Geek

There is some good guidance here: https://gov.wales/land-transaction-tax-rates-and-bands

I will have to stop calling the "higher rates" for additional properties in Wales the "4% surcharge".  The liability for higher rates transactions are unchanged.  The alteration of the bands for standard rated property means one will not be able to work out the higher rate LTT by just adding 4% of the price.

As an aside, there is still no first time buyers' relief in Wales.

housebuyer143

t1redmonkey said:

I don't think it's as bad as you might initially think.  Removed the tax entirely from purchases up to the value of £225k (there is still a lot of property in Wales below that amount so will benefit a lot on lower incomes). 

Also, you are maybe reading it or thinking about it slightly wrong, because you also end up paying less tax beyond £225k in the new system as well - up to £345k.  E.g. House for £275k under existing system = £3700 tax, under new system = £3000 tax.

According to their own stats the changes only benefit 60% of buyers, so the other 40% are paying more 🤷‍♀️
Doesn't really affect me, but I can see the future of the new council tax bands playing out before my eyes and it's not going to result in less to pay for me. 

t1redmonkey

housebuyer143 said:

t1redmonkey said:

I don't think it's as bad as you might initially think.  Removed the tax entirely from purchases up to the value of £225k (there is still a lot of property in Wales below that amount so will benefit a lot on lower incomes). 

Also, you are maybe reading it or thinking about it slightly wrong, because you also end up paying less tax beyond £225k in the new system as well - up to £345k.  E.g. House for £275k under existing system = £3700 tax, under new system = £3000 tax.

According to their own stats the changes only benefit 60% of buyers, so the other 40% are paying more 🤷‍♀️
Doesn't really affect me, but I can see the future of the new council tax bands playing out before my eyes and it's not going to result in less to pay for me. 

But they're not reviewing the council tax bands.  This is only about the LTT.  It says in their release that only 15% of property transactions will end up paying more LTT after these changes.

housebuyer143

t1redmonkey said:

housebuyer143 said:

t1redmonkey said:

I don't think it's as bad as you might initially think.  Removed the tax entirely from purchases up to the value of £225k (there is still a lot of property in Wales below that amount so will benefit a lot on lower incomes). 

Also, you are maybe reading it or thinking about it slightly wrong, because you also end up paying less tax beyond £225k in the new system as well - up to £345k.  E.g. House for £275k under existing system = £3700 tax, under new system = £3000 tax.

According to their own stats the changes only benefit 60% of buyers, so the other 40% are paying more 🤷‍♀️
Doesn't really affect me, but I can see the future of the new council tax bands playing out before my eyes and it's not going to result in less to pay for me. 

But they're not reviewing the council tax bands.  This is only about the LTT.  It says in their release that only 15% of property transactions will end up paying more LTT after these changes.

You are right..I misread it. 60% will pay no tax. 

They are changing the council tax bands next year. There was a consultation on it.

t1redmonkey

housebuyer143 said:

t1redmonkey said:

housebuyer143 said:

t1redmonkey said:

I don't think it's as bad as you might initially think.  Removed the tax entirely from purchases up to the value of £225k (there is still a lot of property in Wales below that amount so will benefit a lot on lower incomes). 

Also, you are maybe reading it or thinking about it slightly wrong, because you also end up paying less tax beyond £225k in the new system as well - up to £345k.  E.g. House for £275k under existing system = £3700 tax, under new system = £3000 tax.

According to their own stats the changes only benefit 60% of buyers, so the other 40% are paying more 🤷‍♀️
Doesn't really affect me, but I can see the future of the new council tax bands playing out before my eyes and it's not going to result in less to pay for me. 

But they're not reviewing the council tax bands.  This is only about the LTT.  It says in their release that only 15% of property transactions will end up paying more LTT after these changes.

You are right..I misread it. 60% will pay no tax. 

They are changing the council tax bands next year. There was a consultation on it.

Ah you are right on council tax bands being looked at, first I heard of it to be honest.  But I just did a quick speed read of their consultation document and they wouldn’t be changing them until 2025 (but values would based on valuations as at 1 April 2023).

housebuyer143

t1redmonkey said:

housebuyer143 said:

t1redmonkey said:

housebuyer143 said:

t1redmonkey said:

I don't think it's as bad as you might initially think.  Removed the tax entirely from purchases up to the value of £225k (there is still a lot of property in Wales below that amount so will benefit a lot on lower incomes). 

Also, you are maybe reading it or thinking about it slightly wrong, because you also end up paying less tax beyond £225k in the new system as well - up to £345k.  E.g. House for £275k under existing system = £3700 tax, under new system = £3000 tax.

According to their own stats the changes only benefit 60% of buyers, so the other 40% are paying more 🤷‍♀️
Doesn't really affect me, but I can see the future of the new council tax bands playing out before my eyes and it's not going to result in less to pay for me. 

But they're not reviewing the council tax bands.  This is only about the LTT.  It says in their release that only 15% of property transactions will end up paying more LTT after these changes.

You are right..I misread it. 60% will pay no tax. 

They are changing the council tax bands next year. There was a consultation on it.

Ah you are right on council tax bands being looked at, first I heard of it to be honest.  But I just did a quick speed read of their consultation document and they wouldn’t be changing them until 2025 (but values would based on valuations as at 1 April 2023).

Ooo well that's better. If the house prices collapse next year maybe I will end up paying less 😂😂😂