CHANGES TO TAX RELIEF FOR LANDLORDS COMING INTO FORCE
April sees the start of changes limiting tax relief for residential landlords. The measures, first announced in 2015, will be phased in over the next three years.
The relief landlords receive will be restricted to the basic rate of income tax. Additionally, finance costs won’t be taken into account when calculating taxable profits – instead a tax reduction will be applied on the costs, normally at the basic rate.
HM Revenue & Customs claims only some landlords will pay more tax as a result of these new measures but concerns have been expressed by the National Landlord Association that some of their members may be pushed into a higher tax bracket as a result of the changes.
The transitional three year period begins on 6th April and phases the percentage of finance costs that can be deducted from rental income down to 75% in 2017/18 and reducing by a quarter each year until 2020.
Further information and an explanation of the changes to tax relief can be found here and, as ever, Flick & Son is on hand to discuss any aspect of changes to legislation. Our experienced lettings team can offer helpful advice as part of our range of property management services. Please get in touch on 01728 633773.
NEW ENERGY PERFORMANCE STANDARDS FOR RENTED PROPERTY
If you rent out a property do you know it's energy performance rating? From April 2018, properties rating below E will be considered as substandard for letting to new tenants. This will also apply to existing tenancies from 2020.
It is possible that the dates for this new rule might be deferred, but once implemented, properties rated F or G will not be considered suitable for letting to tenants until improvements are made.
Flick & Son will keep you fully up to date on the latest legislation regarding the letting of your property. We're always happy to offer the best qualified advice so please get in touch with our lettings team on 01728 633773.
Helen Brewster MARLA MNAEA
Director, Residential Letting and Management, Flick & Son