Buy-to-let tax breaks for landlords to be reduced
Landlords across the UK will be paying more tax following Chancellor George Osborne’s Budget announcement to reduce tax relief for higher earners.
The government will restrict the amount of tax relief landlords can claim for residential properties to the basic rate of income tax (20%) rather than the current maximum of 45%.
Aaron Strutt, product manager at Trinity Financial, says: “One of the specialist buy-to-let lenders has told us that the average higher rate tax paying landlord with a £250,000 property and an average mortgage will effectively be £1,300 worse off because of the changes.
“They explained that the new rules are likely to be less of an issue for hobby landlords with a couple of properties – but more troublesome for those with larger portfolios.
“Buy-to-let is likely to remain popular while there is such a shortage of housing and prices are rising. Mortgage rates are also still particularly cheap.”
The restriction will be phased in over four years, starting from April 2017.
For help to secure a buy-to-let mortgage, call Trinity on 020 7016 0790.
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