Chancellor urged to ‘breathe life back into the private landlord sector’
Buy-to-let landlords believe that today’s Spring Statement provides the chancellor Philip Hammond with an opportunity to bolster activity in the buy-to-let market, which has continued to slow primarily due to the previous chancellor’s tax changes.
A number of tax and regulatory changes have hit landlords’ profits over the past couple of years, including the scrapping of the ‘wear and tear’ allowance, the introduction of the 3% stamp duty surcharge, and mortgage tax relief cuts which simply do not add up for buy-to-let investors.
Landlords used to be able to deduct mortgage interest and other finance-related costs from their rental income before calculating their tax liability.
However, this interest relief is being slashed from 100% to 0%, with the change being gradually phased in between April 2017 and April 2020, and as a consequence the PRS is in need of a major boost.