Tax changes named as top concern for British landlords in 2017
Changes to tax relief on mortgage interest payments is the top concern for buy to let landlords in the UK and they would also like to see other taxes cut.
The change to tax relief is due to come into force in April but landlords are still hoping that the Government will do a U-turn and not introduce the change which means that the relief will be phased out over the next three years.
Landlords also want to see capital gains tax reduced when they sell properties and also an end to the 3% rate of stamp duty payable on additional homes, according to a survey from Landlord Voice.
Some 47% of landlords who took part in the poll said that the change to mortgage tax relief is their biggest worry. It means that by 2020 landlords will be taxed on their income and for some, this could push them into a higher rate tax bracket.
However a separate poll of landlords conducted by the Council of Mortgage Lenders found that half owned their properties outright and would therefore not be affected by the changes as their properties are mortgage free.
Although the basic rate of capital gains tax dropped to 10% in 2016 landlords pay 18% on residential property if they’re in the basic income tax band, or 28% in the higher band.
Despite their concerns the poll found that overall landlords are still optimistic about the future and 36% of respondents rated their confidence level in the year ahead at eight out of 10 or higher.
On top of that, some 88% plan to remain as landlords for the next year and a third plan to increase their portfolios.
‘We strongly urge Chancellor Philip Hammond to listen to landlords’ concerns. Landlords should be supported and recognised for their contributions in providing affordable housing, rather than burdened with unfair tax measures that will see them having to take considerable cuts to their income and being forced to pass some of this to their tenants,’ said Jenny Mayes from Simple Landlords Insurance.