When a company group cuts LTT on land moved into a partnership
The short answer
A company group can reduce LTT where land moves into a partnership and a group company is a partner. In WRA’s example, the reduction makes the LTT charge nil.
- The companies must meet the statutory group test.
- The company is treated as a matching partner for this calculation.
- The rule does not apply to transfers out of a partnership.
Scroll down for the full analysis.
Read the original guidance here:
When a company group cuts LTT on land moved into a partnership
When a company group cuts LTT on land moved into a partnership
When a company puts land into a partnership, Land Transaction Tax can still arise even where related people remain involved. A narrow rule can, where another company in the same group is a partner after the transfer and the statutory conditions are met, cut the bill to nil. This is Land Transaction Tax, called LTT.
What this rule is about
A transfer of land into a partnership is not treated as an ordinary sale. Before calculating the charge, the law compares who owned the land before the move with who shares the partnership profits afterwards. That sequence matters.
That comparison produces the sum of lower proportions, often shortened to SLP. Put simply, it measures how much of the land has remained with people linked to the former owner after the partnership transfer. That is the SLP.
As the SLP increases, the calculation regards less of the land as having passed to new economic owners. LTT may therefore apply to a smaller amount.
What the official source says
The WRA example involves A Ltd, B Ltd and two individuals. In that example, A Ltd transfers land into a partnership comprising Individual 1, Individual 2 and B Ltd, each participating after the transfer for the purposes of the calculation.
A Ltd and B Ltd are both 75% subsidiaries of C Ltd. Under the connected-person rules, the individuals are connected with A Ltd. So the special partnership calculation applies.
- B Ltd is a partner after the transfer.
- Normally, B Ltd does not count as A Ltd’s matching partner.
- That is because the ordinary matching rule generally covers the former owner or a connected individual.
- However, A Ltd and B Ltd are in the same company group.
- The special connected-company rule then treats the calculation as though B Ltd were a matching partner.
- In WRA’s example, this makes the SLP 100%.
- The resulting LTT charge is reduced to nil.
WRA’s page is guidance explaining the legislation. You will find the legal rule in Schedule 7 to the Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017. That is the governing legislation.
What this means in practice
This is not a blanket group exemption for partnership transfers. Instead, it corrects a gap in the normal partnership calculation when a group company participates, even though that company would not ordinarily match the former owner. The calculation changes.
One point is easy to miss: a company can fail the usual matching-partner test, yet still produce a lower LTT result if it is in the same group as the former owner.
- Check the company group before assuming LTT is due in full.
- Check who owned the land just before the transfer.
- Check every partner immediately after the transfer.
- Use the partnership profit shares, not an informal idea of who is involved.
- Keep records that prove the group structure.
- Do not assume the same result applies if land leaves the partnership.
That last point matters. The official example makes clear that this rule does not run both ways. It applies to a transfer into a partnership, not a transfer from one.
How to analyse it
Start with the direction of the land transfer. Then work through the ownership and group links in order. A family connection alone does not show that two companies are in the same group.
- Has land become partnership property?
- Who had the right to that land immediately before the transfer?
- Is that former owner a partner afterwards, or connected with one?
- Which people count as matching partners under the normal rule?
- Is there a company partner that would match but for the rule about connected individuals?
- Are that company and the former owner in the same group under the 75% tests?
- What SLP would result if that company counted as a matching partner?
- Does that revised figure reduce the LTT charge?
What actually decides the answer? Legal ownership, the partnership shares and the company group do. Labels such as “family business” do not settle it.
Example
Imagine the facts in WRA’s example. Here, A Ltd transfers land to a partnership that includes B Ltd and two individuals connected with A Ltd, while A Ltd and B Ltd are both 75% subsidiaries of C Ltd. Those are the relevant group facts.
B Ltd would not normally be A Ltd’s matching partner because it is a company, rather than an individual connected with A Ltd. For the calculation, the special rule changes that result. Where treating B Ltd as matching gives an SLP of 100%, and the special connected-company rule applies because both companies are in the same group, the calculation reduces the LTT charge to nil. No charge remains.
No land value is needed to explain this example. The result turns on the 100% SLP, not on a rate or threshold.
Why this can be difficult in practice
Company ownership can look simple on a chart but fail the statutory group test. That test covers share capital, profits and assets available on a winding-up. All three can matter.
Partnership documents can also create problems. For this purpose, the law considers each person’s share of income profits immediately after the transfer. An unclear or later-written agreement may not show the right position.
- A common mistake is to treat any connected company as a matching partner.
- Another is to rely only on who owns most shares.
- Family links and company-group links are different tests.
- The rule cannot simply be copied for a transfer out of a partnership.
- Group-relief rules may affect the reduction, including where the group later changes.
Key takeaways
- A same-group company can reduce LTT on land moved into a partnership.
- The result depends on the SLP calculation and the statutory group test.
- This connected-company rule does not apply to land moved out of a partnership.
Technical analysis
For advisers, and for anyone who wants to check the law behind this page. You do not need this section to understand the guidance above.
Legislation
- LTTA 2017 section 41 — introduces the special rules for partnership land transactions
- LTTA 2017 Schedule 7 para 13 — sets the tax calculation for land transferred to partnerships
- LTTA 2017 Schedule 7 para 14 — calculates ownership proportions and matching partnership shares
- LTTA 2017 Schedule 7 para 41 — reduces tax where connected companies are in one group
- LTTA 2017 Schedule 16 para 3 — defines companies that are members of the same group
Official guidance
The pages below are the Welsh Revenue Authority’s guidance. Guidance is not law. It sets out how the Welsh Revenue Authority reads the legislation, and it is not binding on you, on a tribunal or on a court. Where guidance and the legislation differ, the legislation wins. the Welsh Revenue Authority can also change or withdraw guidance, and it may not cover your facts.
Where this is not settled
- The source does not give the ownership shares, partnership profit shares or land value needed to calculate a result in another case.
- Whether companies are in the same group depends on the full statutory 75% tests, not simply on a shared family connection or similar company names.
- The supplied statutory material does not state its currency date, so the current law and any later changes need checking.
Evidence you would need
This kind of case is decided on the facts of the individual property. These are the records that usually settle it, and the ones an adviser would ask you for.
- Company share registers and documents showing rights to profits and assets on a winding-up.
- The partnership agreement, including each partner’s share of income profits after the transfer.
- Documents showing who owned the land immediately before it became partnership property.
- The transfer documents and the market value used for the calculation.
Explore this with an AI
Readers often want to test their own situation. Copy the prompt below into ChatGPT, Claude or Gemini. It hands the model the actual legislation for this page rather than letting it answer from memory, and tells it to be explicit about what is uncertain. What comes back is information, not advice – check it against the links above.
I am researching Land Transaction Tax (LTT), the tax on property in Wales. It replaced Stamp Duty Land Tax in Wales on 1 April 2018, and SDLT does not apply in Wales. MY QUESTION When a company group cuts LTT on land moved into a partnership [Replace this with your own situation: what you are buying, the price, the dates, who the buyer is, and what you plan to do with the property.] THE LAW THIS TURNS ON - LTTA 2017 section 41 - introduces the special rules for partnership land transactions https://www.legislation.gov.uk/anaw/2017/1/section/41 - LTTA 2017 Schedule 7 para 13 - sets the tax calculation for land transferred to partnerships https://www.legislation.gov.uk/anaw/2017/1/schedule/7/paragraph/13 - LTTA 2017 Schedule 7 para 14 - calculates ownership proportions and matching partnership shares https://www.legislation.gov.uk/anaw/2017/1/schedule/7/paragraph/14 - LTTA 2017 Schedule 7 para 41 - reduces tax where connected companies are in one group https://www.legislation.gov.uk/anaw/2017/1/schedule/7/paragraph/41 - LTTA 2017 Schedule 16 para 3 - defines companies that are members of the same group https://www.legislation.gov.uk/anaw/2017/1/schedule/16/paragraph/3 Guidance page from the Welsh Revenue Authority on this topic (guidance, not law): https://www.gov.wales/partnerships-and-land-transaction-tax-technical-guidance HOW I WANT YOU TO ANSWER 1. Work from the legislation above. Read it before answering. Guidance from the Welsh Revenue Authority is its view of the law, not the law, and does not bind a tribunal or a court. 2. Tell me what the rule actually requires, in plain English. 3. Tell me which facts decide the answer, and which facts would change it. 4. Tell me what evidence I would need to support the position. 5. Be explicit about anything unsettled or fact-sensitive. Do not guess. 6. Your training data has a cutoff and SDLT rates and reliefs change at fiscal events. Say so if you are not sure the law is current. POINTS ALREADY KNOWN TO BE UNCERTAIN ON THIS TOPIC - The source does not give the ownership shares, partnership profit shares or land value needed to calculate a result in another case. - Whether companies are in the same group depends on the full statutory 75% tests, not simply on a shared family connection or similar company names. - The supplied statutory material does not state its currency date, so the current law and any later changes need checking. Do not give me a conclusion you cannot support from the provisions above.
Legislation links show the Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017 as it stood on 2025-11-17. The law may have changed since, and the rules that apply are those in force on the date of your transaction. The official guidance this page is based on is here.
This page was last updated on 3 September 2026
Useful article? You may find it helpful to read the original guidance here: When a company group cuts LTT on land moved into a partnership
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