Two key tax changes were announced in the autumn statement making it less appealing to buy a property and rent it out.
From 6thApril 2016 anyone buying a second home or a buy-to-let property (over £40,000) will pay a 3 percentage point surcharge on their stamp duty bill.
From 2017 the amount that some landlords can claim in tax relief on their finance costs (such as mortgage interest payments, interest on loans to buy furnishings and fees incurred on taking out and repaying mortgages) is being gradually reduced over 4 years.
From the beginning of the 2020/21 tax year, landlords will be only be able to claim tax relief at the basic tax rate of 20%, instead of 40% or 45% for those in higher or top rate income tax brackets respectively
Also from April 2019 landlords will have to pay their capital gains bill within 30 days of selling a property.
Chris Wallace, Managing Director, Visionary Accountants St Albans said: ‘the recent changes announced by the Chancellor will affect anyone who owns a second home or has a buy-to-let portfolio. We recommend that anyone in this position gets tax advice immediately before the April budget, as alternative options are available. For individual tax advice from Visionary Accountants, St Albans - Call Jay Doshi, our Chartered Tax Adviser on 01727 840550.’