From 13 February 2026, the minimum Land Transaction Tax due where multiple dwellings relief is claimed increases to 3% of the consideration attributable to the dwellings, up from 1%. The change is enacted by regulations approved by the Senedd. (laiddocuments.senedd.wales)
Legally, the instrument amends paragraph 6(2) of Schedule 13 to the Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017. The 3% rate is a floor applied to the part of the price attributable to dwellings when relief is claimed; it does not alter how any non‑residential element is taxed. (laiddocuments.senedd.wales)
Welsh Government materials state the minimum‑tax rule exists to prevent very low or nil liabilities on dwellings in multiple‑dwelling transactions and to maintain fairness with single‑dwelling purchases. Ministers had explored an additional “equalisation rule”, but it is not included in this instrument because of technical complexity and has been deferred for a future administration to consider. (gov.wales)
Transitional protection is provided. The 3% rate does not apply where a transaction is effected under a contract entered into and substantially performed before 13 February 2026, or under a contract entered into before that date, provided anti‑forestalling conditions are not triggered. Protection is lost if, on or after 13 February, the contract is varied or rights are assigned, an option or right of pre‑emption is exercised, or there is an assignment or subsale so that a person other than the original buyer can call for transfer. (laiddocuments.senedd.wales)
A further saving applies for linked transactions. Where a post‑commencement transaction is linked to a pre‑commencement ‘relevant transaction’ for Schedule 13 purposes, the amendment does not take effect for the post‑commencement transaction. (laiddocuments.senedd.wales)
Contextually, multiple dwellings relief has carried a 1% minimum since its 2011 introduction in Stamp Duty Land Tax and was incorporated into LTT in 2018. The UK Government abolished SDLT MDR from 1 June 2024; Wales consulted in 2024 and opted for targeted adjustments rather than abolition. Welsh Government’s impact assessment frames the change as improving fairness with a marginal revenue effect. (gov.wales)
For conveyancers and tax advisers, immediate tasks include verifying exchange and substantial‑performance dates, reviewing any planned variations or assignments that could disapply transitional protection, and re‑running models where MDR calculations may fall below the new 3% floor. The Welsh Revenue Authority has indicated guidance and agent communications will be updated to reflect the change. (gov.wales)
Illustration: a £2,000,000 bulk purchase of dwellings that, after applying MDR, would otherwise produce a charge below the minimum would previously have faced a £20,000 floor at 1%; from 13 February the floor becomes £60,000 at 3%. Actual liabilities will depend on valuations, apportionments and any non‑residential elements in mixed‑use cases.
Sectors most exposed are buyers in mixed‑use acquisitions and portfolio transfers in the private rented, build‑to‑rent and purpose‑built student sectors, where MDR is commonly engaged. The consultation summary records arguments for retaining MDR while improving fairness, situating this increase as a proportionate recalibration rather than abolition. (gov.wales)
The regulations do not create a new relief or change headline LTT rates; they recalibrate the minimum liability when MDR applies. For planning, parties should assume the 3% floor applies to effective dates on or after 13 February 2026 unless the transaction clearly meets the transitional conditions described above. (laiddocuments.senedd.wales)