UK landlords’ number one interest when it comes to Government policy is a reversal of Section 24 changes to tax relief on buy to let mortgages, according to a survey by Paragon Mortgages.
The reforms, announced by George Osborne in the 2015 summer budget, are being phased in between April of this year and 2021. When they are fully implement, higher rate taxpayers will no longer be able to offset all their mortgage interest against their rental income when calculating their tax bill.
Paragon Mortgages surveyed landlords following the general election and asked them what actions they would most like to see the new Government taking, in order to improve prospects for buy to let investors.
The highest ranking answer was the reversal of Section24. The second most common response was for the Government to make no new reforms to the sector to allow landlords a period of stability in order to adapt to recent changes.
The third most popular answer was for landlords to be made exempt from capital gains tax and Stamp Duty when they moved their properties over to a limited company. According to the survey, 11% of landlord were taking steps to adopt a limited company structure for their portfolios.
20% of landlords said they intended to increase rents in order to mitigate the impact of Section 24 and other recent measures, such as increases to Stamp Duty and the cap on tenants’ deposits, on their finances.
20% said they would consolidate their position by selling properties or halting plans to buy more homes.
John Heron, manager director of Paragon Mortgages, said: “Having taken active steps in preparing for a difficult period of transition as the tax relief changes continue to be phased in, landlords are now facing up to the challenge ahead. Higher tax charges for landlords have combined with a general increase in uncertainty to drive confidence levels down. “
If you’re a landlord worried about the impact of Section 24 or other recent reforms to the buy to let sector on your finances, contact Landlord Debt Advisory for a consultation and find out how we can help you.
Call us on 0161 222 4311 or go online to landlorddebtadvisory.com.