In the wake of the Summer Budget where the Chancellor announced serious tax changes for Landlords, the RLA has met with George Osborne directly and with officials from the Treasury and HMRC. Although we have been told there will be no U turn on changes to Mortgage Interest Relief proposals we have been asked to propose other ‘tax solutions’ to the Treasury and will be doing so in the near future. If you have alternative ideas on tax relief then please let us hear them!
We are sure it hasn’t escaped your attention but back in the Summer Budget the Chancellor announced a raid on tax relief for landlords’ finance charges. Between April 2017 and April 2020 restrictions on Mortgage Interest Relief will be phased in, limiting relief to the basic rate of tax.
Although you can use the RLA tax calculator to see how this impacts you, typically a landlord with £150,000 buy-to-let mortgage on a property worth £200,000 could see his or her profit fall from around £2,160 to just £960 a year.
Over the past month the RLA has met with the Chancellor, George Osborne, directly and with officials from the Treasury and HMRC. While we have been told that “there will be no U-turn on this” it shouldn’t stop us from trying.
We have, however, been asked to propose other ‘tax solutions’ to the Treasury and will be doing so in the near future.
If you have alternative ideas on tax reliefs then we would be happy to hear them, particularly if you can provide reasons other than just ‘it will save the landlord money’. For instance, allowing energy efficiency improvements to be written off against income as opposed to capital improvement will encourage landlords to invest in energy efficient measures. Please email your ideas to email@example.com
In the meantime a petition has been set up calling for the reversal of the planned tax relief restriction on ‘individual’ landlords. The petition already has 14,000 signatures which means that the Government will formally respond. If we can reach 100,000 signatures it will be considered for a debate in Parliament. Although we may be a long way off 100,000 yet, each signature counts. The RLA also have a dedicated Tax Campaign webpage where you can write to your MP
The RLA will continue to work hard to deliver the best deal possible for landlords and the whole of the private rented sector and your continued support is appreciated in what is an increasingly challenging climate.