As part of the 2022-23 budget, the Welsh Government have launched a consultation ‘Local variation to land transaction tax rates for second homes, short-term holiday lets and potentially other additional residential properties’ seeking views on possible Land Transaction Tax (LTT) changes.

Land Transaction Tax (LTT) replaced Stamp Duty Land Tax (SDLT) in Wales in April 2018. LTT is a national tax, collected by the Welsh Revenue Authority, payable on the purchase of land or property in Wales


It is proposed that increased rates of LTT could be charged for some transactions in areas that are identified as requiring support to manage issues associated with second homes and short-term holiday lets.

The changes aim to give more opportunities to people who are looking to buy homes for permanent occupation.

The consultation closes on 28 March 2022. Responses can be made online, by email or by post.

Consultation questions

  1. Do you agree that the Welsh Government should be able to increase rates of LTT for second homes and short-term holiday lets in areas where there is an evidenced case to do so?
  2. What are your views on whether the size of areas covered by local variations of rates should be local authority-wide or only in smaller communities?
  3. What are your views on how an area should be determined to be subject to changes in rates?
  4. If criteria are used to determine which areas are subject to changes in rates, what do you think the criteria should be?
  5. What are your views on how regularly areas in which increased rates apply should be reviewed?
  6. What are your views on:
    • Varying the existing higher rates for all higher rate transactions within a specified area? 
    • Introducing new rates applied only to purchases of properties intended to be used as second homes or short-term holiday lets within a specified area?
  7. Does the size of the area (the whole of the local authority or smaller areas within it) in which increased rates would apply influence your views on whether separate rates for second homes and short-term holiday lets are necessary?
  8. Do you agree short-term holiday lets should be subject to any increased rates, as well as second homes? Please explain your answer.
  9. Do you agree properties that cannot be occupied for all of the year should not be subject to any increased rates? Please explain your answer.
  10. Are there any current higher rates transactions, other than second homes and short-term holiday lets, for which you think increased rates may also be appropriate? Please explain your answer.
  11. Do you agree that there should be a clawback rule so that if within a specified period after the date of the transaction, the use of the property changes to one on which increased rates would have been payable, the taxpayer should have to submit a new return and pay the additional tax?
  12. Are there any circumstances where such clawback rules would apply, but you do not consider that it would be appropriate or fair?
  13. If a property was bought where the buyer’s intention was to use it as a second home or short-term holiday let but it is not then used in this way, do you think the taxpayer should be able to claim a refund of the additional tax?
  14. What length of time do you think would be appropriate for a clawback and/or refund period?
  15. If rates are introduced which require consideration of intended use, do you have any comments on how the design could make it simpler for taxpayers to comply with by minimising the scope for error?
  16. What effects do you think these proposals may have on the Welsh language and communities who predominately use Welsh? How could positive effects be increased, or negative effects mitigated?
  17. We have asked a number of specific questions. If you have any additional points related to LTT for second homes and short-term holiday lets which have not been specifically addressed, please make them here.

Useful guides on this topic

Welsh Land Transaction Tax
What is Land Transaction Tax? How does it operate? What reliefs are available? 

Welsh LTT Rates
What are Welsh Land Transaction Tax (LTT) Rates? How do you calculate Welsh Land Transaction tax?

Welsh LTT vs SDLT: Comparing the rates and additional dwellings charge
How does Welsh Land Transaction Tax (LTT) compare to Stamp Duty Land Tax (SDLT)? What are the key similarities and differences?

External link

Consultation: Local variation to land transaction tax rates for second homes, short-term holiday lets and potentially other additional residential properties

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