This coming April there are important changes in the tax regime for private landlords.
Until now the interest payments on any finance associated with a let property (ie a mortgage or loans for furniture etc) could be set against the “profit” of the rental income. This tax relief will not be totally abolished immediately, but from April 2017 it will be gradually limited to the basic rate of income tax.
That means in effect that many landlords can expect to pay more tax on their rental incomes. The difference may not be huge (remember the relief was only available on the interest costs, not any capital repayments), but it’s certainly worth planning for.
Here’s a link to the full policy paper.
If you have any concerns about the likely effect on you please talk to us.
By Jaimie Beers
Jaimie Beers is managing director of Madley Property.