If you can answer YES to any of the following, it is important that you read the ‘Tax Increases for Landlords‘ document:
• You receive rental income from furnished property
• You are a higher-rate taxpayer in receipt of rental income from a property with a mortgage
• You intend on purchasing a buy-to-let property or second home
The Government announced two major changes to the tax treatment of rental expenses in the 2015 Summer Budget, introduced a 3% Stamp Duty Land Tax (“SDLT”) surcharge and announced changes to Capital Gains Tax (“CGT”) administration in the 2015 Autumn Statement. We take a detailed look at these changes and examine the impact that they will have on landlords.
The two changes introduced by the 2015 Summer Budget are as follows:
• Withdrawal of higher-rate income tax relief on mortgage interest; and
• Withdrawal of the 10% Wear & Tear allowance for furnished property and the re-introduction of the ‘Renewals basis’
To read the overview published by our partner, Humphrey & Co, click here.
If you would like further information on the effects of the tax changes, and would like to minimise the impact of these changes to your buy to let portfolio, please contact us to find out more.