Nov 24 – How the budget affects landlords specifically

It could have been worse…

Whilst the PRS was bracing itself for a gutting budget, Reeves actually delivered a budget that didn’t specifically single out landlords for horrific tax rises. Let’s look at the highlights that affect landlords directly.

• Stamp Duty (SDLT) increase for additional homes

This will affect anyone looking to buy an additional home, or landlords/investors looking to grow their portfolio. The rise is quite hefty, with some calculations looking at landlords paying an additional £12,500 on a £250,000 property. The aim of the government was to ‘disincentivise the buying of second homes and buy-to-let properties and freeing up stock for main home and first time buyers’.

• Capital Gains Tax

CGT on the disposal of residential properties will not increase, staying at 18% and 24% for the differing tax bands.  However they have increased CGT on other assets, like shares and unit trusts held outside an ISA.

• Income tax

This remains the same, at 20% tax credit on mortgage repayments for landlords who own properties in their own names. Additionally for landlords who own property through a Ltd company and receive a salary from it, will now be required to report any benefits in kind via payroll instead of the P11Ds.