Court-Appointed Deputy Acquires Property for Minor, Avoids LTT Higher Rates

LTT higher rates when a court-appointed deputy buys a home for a child

For Welsh Land Transaction Tax, a special rule can stop a child’s home purchase being linked to the parents’ property ownership where a qualifying court-appointed deputy buys the property in the child’s name or on the child’s behalf. This means the child is treated separately from the parents for higher-rates purposes, although the child’s own property interests still need to be checked.

• The rule applies where at least one buyer is a deputy appointed by a court under section 16 of the Mental Capacity Act 2005, or under a similar law outside England and Wales.
• If the rule applies, the parents’ ownership of a home does not by itself cause higher rates to apply to the child’s purchase.
• The deputy does not have to be the only buyer; the rule can still apply if there are other co-owners such as parents, relatives or guardians.
• This is not a full exemption from higher rates: once the child is treated separately, the child’s own existing dwelling interests must be considered in the normal way.
• The rule is narrow and depends on the exact legal appointment and ownership structure, so similar overseas appointments may need careful review.

Scroll down for the full analysis.

LTT higher rates: when a court-appointed deputy buys a home for a child

This page explains a special rule in the Welsh higher rates of Land Transaction Tax for residential property bought for a child by a court-appointed deputy. The rule matters because, without it, a child’s purchase can sometimes be linked to the property ownership of the child’s parents. In this specific situation, that parental link is switched off.

What this rule is about

Higher rates of LTT can apply when a buyer already owns an interest in a dwelling and buys another dwelling. Special attribution rules can also treat a minor child’s dwelling interests as if they were the parents’ interests, and vice versa, when deciding whether higher rates apply.

The source material deals with an exception to that approach. It applies where a dwelling is acquired, held or disposed of by a deputy appointed by a court under section 16 of the Mental Capacity Act 2005, or by someone appointed under a similar law outside England and Wales, and the dwelling is acquired in the child’s name or on the child’s behalf.

In that situation, the law does not treat the dwelling as if it were the parents’ interest for higher-rates purposes. Instead, the child is treated separately.

What the official source says

The official material says that the normal rule linking a child’s dwelling interests to the child’s parents does not apply where one of the people acquiring the dwelling is a qualifying court-appointed deputy and the dwelling is acquired in the child’s name or on behalf of the child.

This exclusion is not limited to cases where the deputy is the only buyer. It is enough that one of the acquirers is a court-appointed deputy. Other co-owners might include parents, relatives or guardians.

Where the rule applies, the dwelling is treated, for higher-rates purposes, as belonging to the child rather than being treated as the parents’ interest. The practical effect is that the child’s property position is considered separately from the parents’ property position.

The guidance also says that, in substance, the child is treated as though they were an adult for this purpose. So the child’s own dwelling ownership matters for later purchases, but the parents’ ownership does not automatically infect the child’s purchase.

What this means in practice

If a child’s parents already own a home, that does not by itself mean higher rates will apply when a deputy buys a dwelling for the child under this rule. The child’s purchase is tested by reference to the child’s own position, not by deeming the parents to be the relevant owners.

This can be very important where a child has received compensation or other funds and a deputy is appointed to manage property decisions. A purchase made for the child’s benefit should not automatically be pushed into the higher rates simply because the parents own their own home and are keeping it.

But the rule does not create a blanket exemption from higher rates. It only disconnects the child from the parents for this purpose. Once the child is treated separately, the child’s own dwelling ownership becomes relevant in the normal way. So if a deputy later buys another dwelling for the same child while the first is still owned, higher rates may then apply because the child already has an interest in a dwelling.

How to analyse it

A sensible way to approach the issue is to ask these questions:

• Is the transaction within the Welsh LTT higher-rates rules for dwellings?
• Is one of the acquirers a deputy appointed by a court under section 16 of the Mental Capacity Act 2005, or under a similar overseas provision?
• Is the dwelling being acquired in the child’s name or on behalf of the child?
• If there are other buyers or co-owners, does at least one qualifying deputy form part of the acquisition?
• Once the special rule is applied, what dwelling interests does the child already own or hold for higher-rates purposes?
• Are you wrongly relying on the parents’ ownership position, when the rule requires the child to be treated separately?

The key analytical point is that this rule changes whose property interests are counted. It does not remove the need to consider whether the child already owns another dwelling.

Example

A child receives a large damages award. A solicitor is appointed by the court as the child’s deputy under section 16 of the Mental Capacity Act 2005. The child lives with their parents in a house owned by the parents. The deputy buys a more suitable house in the child’s name using part of the award, and the parents keep their existing home.

On these facts, the higher rates do not apply just because the parents still own their house. The child’s purchase is treated separately from the parents’ ownership.

However, if the deputy later buys another dwelling for the child while the first child-owned dwelling is still held, that later purchase may fall within the higher rates because the child already owns an interest in a dwelling.

Why this can be difficult in practice

The main difficulty is that the rule is narrow. It does not apply simply because a child is involved, or because someone is acting for the child. The source specifically refers to a deputy appointed by a court under section 16 of the Mental Capacity Act 2005, or under a similar provision outside England and Wales. Whether a foreign appointment is sufficiently similar may require careful comparison.

Another practical difficulty is ownership structure. The guidance says the deputy does not have to be the sole acquirer, but one of the acquirers must be the deputy. That means the exact way the title is taken can matter.

There is also room for confusion between two separate questions: first, whether the parents’ dwelling interests are ignored; and second, whether the child already owns another dwelling. The special rule only answers the first question. The second still has to be analysed under the normal higher-rates framework.

Key takeaways

• Where a qualifying court-appointed deputy acquires a dwelling in a child’s name or on the child’s behalf, the child is not linked to the parents’ dwelling ownership for LTT higher-rates purposes.
• The deputy does not need to be the only buyer, but one of the acquirers must be a qualifying deputy.
• The rule separates the child from the parents, but the child’s own existing dwelling interests can still trigger higher rates on a later purchase.

This page was last updated on 24 March 2026

Useful article? You may find it helpful to read the original guidance here: Court-Appointed Deputy Acquires Property for Minor, Avoids LTT Higher Rates

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