x
By using this website, you agree to our use of cookies to enhance your experience.
STAY CONNECTED!
    
newsletter-button

TODAY'S OTHER NEWS

Landlords could be offered tax incentive for longer tenancies

The government is considering plans to provide financial incentives for those offering longer tenancies, according to the Sunday Times.

The government is proposing a number of options to implement a three-year tenancy model to give renters more security, and that may include a tax break for landlords.

The Sunday Times report that the plans could be unveiled by the Chancellor Philip Hammond during his Budget statement later this month.

The “good landlord” tax break would reward buy-to-let investors who sell properties to sitting tenants.

Under existing rules, investors who sell a rental property are liable to pay capital gains tax at 28% on any profits they make. But the Treasury is weighing up a new Help to Buy proposal whereby landlords would not have to pay capital gains tax when selling up to tenants who had been living in a property for at least three years.

The plan, which has been drawn up by the right-wing thinktank Onward, would see the tax relief windfall split equally with the tenant, who could use it as part of their mortgage deposit.

The thinktank estimates that the average gain per property would be £15,000, meaning a first-time buyer could expect to benefit by an average of around £7,500.

Onward director, Will Tanner, who is a former Downing Street policy chief, said: “Today’s renters are older, more likely to be in rented property for longer and more likely to have children than any generation before them.”

Research by the RLA’s research exchange, PEARL, has found that 73% of landlords would offer longer-term tenancies with a combination of financial incentives and court reform to ensure that they have the confidence that where they provide a longer tenancy they can swiftly regain possession in cases such as tenants failing to pay their rent or committing anti-social behaviour.

Poll: Would you welcome a “good landlord” tax break that rewards buy-to-let investors who sell properties to sitting tenants?

PLACE YOUR VOTE BELOW

  • icon

    I don't have a problem with 3 yr tenancies, but what happens when we get a bad tenant who does not pay? only way would be section 8, expensive, difficult and takes a long time to get them out.

  • icon

    100% agree, will only work if combined with an effective and fair court system that represents landlords equally with tenants

  • icon

    Everything seems to be focused on giving more rights to tenants. Good tenants can easily get long term tenancies. Why help bad tenants? Instead make it easier for landlords to get rid of bad tenants and then the good tenants can have greater choice with properties no longer hogged by bad tenants.

  • icon

    I have just read this article again. Half the CGT relief is to go to the tenant. Who has taken the risk in investing in and maintaining a home for someone else? 100% the landlord! I really don't see why half the tax relief should go to the tenant or why a sitting tenant should get a better deal than anyone else who wants on the housing ladder. The £2000 scrappage deal put up the price of new cars. Help to Buy has made millions more for house builders. This would also put up prices. Governments might try but they can't defeat market forces.

  • icon

    Vote grabbers !!!

  • icon

    The other thing behind this i think is to move the whole business to the corporate sector. us little mortals without titles should not be allowed to own land so the more encouragement to get the little man out the sector using both carrot and stick seems to be the mission in hand. And yes I also find it odd you give your tenant half the CGT . Paying their deposit to by your house from you. Should change your name to Teresa Corbyn!

  • icon

    Many mortgage lenders do not allow a Landlord to let for more than a 1 year fixed contract. I would be prepared to let a property on a 3 year lease to tenants who I have already let to for two years or more and had no problems with which would offer them more security, but I would not take a risk on a new tenant. I don't want to sell my houses at the end of three years though. Would there be any intensive to extend tenancy contract if I did not want to sell?

  • icon

    I'm minded to agree that this is more about winning votes and pandering to those that might have supported labour. All this will achieve is a change in tenure from private rented to owner occupied. It doesn't increase supply or make houses more affordable any more than help to buy did, all that achieved was probably to increase house prices and prop up the market.
    There needs to be a massive increase in house building, and a good deal of those new builds need to be Council and Housing Association properties. That might go some way toward easing demand (cost to rent & house prices) in the private rented sector and the open market.

icon

Please login to comment

valpal
submit
sign up