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Buy-to-let landlords are 'suffering from recent tax changes'

The government is being urged to reconsider punitive tax relief changes for buy-to-let income which is set to be introduced in April in order to prevent landlords from being “forced to either sell up or increase rents”. 

The existing rules that permit landlords to offset all of their mortgage interest against tax will, from April, be phased out, and by April 2020, once they have been withdrawn altogether, it is likely that higher-rate tax payers will only receive 50% of the relief that they currently get.

Following the publication of the housing white paper yesterday, Rob Weaver, director of investments at property crowdfunding platform Property Partner, welcomed the government’s commitment to increase the supply of affordable rental stock, but pointed out that much of the existing housing stock in the PRS could be lost unless landlords are offered greater support.

“The new commitment to boost the supply of affordable rental stock is clearly a sage one and if successful will help ensure that rental prices remain in check with wages, and other prices in the economy,” said Weaver.

He added: “We welcome the tougher action promised against rogue landlords making the rental market a safer, more secure place for tenants. Fair rents, improved rights for tenants and first-class professional management is something we fully support. But it needs to be effective and not an additional burden to the good landlords, as the landlord selective licensing scheme seems to have been.

“Traditional landlords are suffering from recent tax changes including cuts in mortgage interest relief due to kick in this April.

“With increasing constraints on making a profit or even balancing the books, buy-to-let investors could be forced to either sell up or increase rents.” 

  • Peter David

    Theresa May wants to offer more security to the rental sector. She also wants to remove my tax relief on my mortgages and rented properties, which will produce a £40,000 increase in my taxes. There isn't no way the arithmetic adds up for unless I force most of my tenants out into the street as I sell up. Which I have no option but to do, due to section 24...So with one hand she is softly caressing the tenants with soothing noises, and with the other hand she is reaching for their (and our) guillotine. I know there's often a lack of joined up thinking in government but this latest "initiative" makes me question my own sanity, let alone the governments'. Can anyone explain to me nice slow and simple how making me ditch tenants who cannot and don't want a mortgage offer renters more security? It's up there with the USA army once stating that to save a Vietnamese village, they had to destroy it. Which bit of the logic am I missing because I cannot process this at all.

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