What the New Tax Changes Mean for Landlords

As most of us in the residential property investment sector are already aware last Thursday saw the introduction of the first phase of a new government tax move to penalise landlords. Legislation cutting tax relief for higher earning landlords (those earning more than £40,000 per annum) will be phased out gradually over four years and replaced with a standard 20 per cent tax credit. Before April 6, higher earning landlords were able to deduct mortgage interest payments of up to 45 per cent from their tax bills. Like the 3% Stamp Duty on BTL and second homes, the new legislation is intended to hurt landlords in the pocket. And certainly, for some landlords, they’ll be paying more in tax than they make in profit. That’s because they’ll be charged on their full rental income (rather than just profit). Investor Steve Bolton, who led – and lost - a court challenge...
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