Second property land transaction tax causes chaos and anger among Welsh

The funds raised by this new tax will be used for the construction of social housing.

Second-home owners are now required to pay an additional 4% tax when purchasing properties up to £ 180,000, increasing to 16% for homes valued at least £ 1.6 million.

But the attorneys said they were “dismayed” to receive just hours’ notice of the changes.

The Welsh government says it could help raise £ 13 million for social housing.

A spokeswoman added: “As with any budget announcement, these changes were not shared in advance.”

The Law Society says changes that only apply in Wales, but not England, may mean that border lawyers handling purchases in Wales may not be aware until they make a final calculation upon completion.

David Greene, president of the Law Society of England and Wales, said lawyers were shocked when the changes were announced Monday to take effect Tuesday, adding: “These last-minute changes come at a time when lawyers are under enormous pressure.”

The Welsh could pay thousands of additional pounds if they don’t complete their transaction by March 31.

Property lawyers were already grappling with Wales by adopting stricter lockdown measures and people looking to move before the March 31 tax break deadline, Greene said.

This is “a record number of transactions, which are affected by delays in searches,” he added.

“They now have customers who are faced with paying thousands of pounds more if they are unable to proceed with their transaction within the given notice period.”

Edward Friend, a principal at Carreg Law in Carmarthenshire, said five of his clients that were due to complete on Monday or Tuesday were affected, with some managing to do so before the tax increase came along and others now have to pay extra money that they hadn’t anticipated.

“It amounted to a four-hour notice, so yeah, it’s been chaos.”

“If you own a property and buy another, it could be for your son or daughter, or you are working somewhere a vacation home, or because you are separating, it catches you, and you have to pay a raise.”

“Yesterday we had transactions that were going to be completed yesterday and today, mirroring each other, and customers completing today are paying a significant amount more.”

“A client who completed yesterday saved around £ 2,500.”

A friend said his firm now had to review all the files it has open and inform clients that they will have to pay more taxes on the land than at the originally given quote.

“They tend to report how much it costs upfront, so they are budgeting from the moment they submit the offer, the finances of a transaction are done a week in advance, so they have to pay that difference on the spot.”

“The reason it is chaotic is that we have to review the files that we have opened and inform all the clients, and that should be done at the busiest time of the year.”

HICH LTD has revolutionized the property survey market since day one! Are you looking for a roof, structural, or bespoke survey? Request it here!

Follow us on our social networks to keep up to date with the most relevant property market news, tips for being a responsible homeowner, and much more!

Twitter: @HichLTD

Facebook: HICH-LTD