Buy-to-let landlords facing cuts in tax relief

 In Accountancy, Tax

Semi_detached_CroydonI have had quite a few enquiries from Clients regarding the tax changes affecting buy-to-let property investments since the Summer Budget announcements.

The worst affected will potentially have to pay more than double on their investment. In cases where the tax rate payable rises above 100% of profit, this will undermine the financial viability of the investment and forcing them to either increase rents or sell.

George Osborne’s decision to remove landlords’ ability to deduct the cost of their mortgage interest from their rental income has caused this issue. Those who do not have mortgages, are not affected.

The change is due to come into effect from 2017 and will be fully implemented by 2020. However, I have concerns that many buy-to-let investors are not aware of the implications and I am already giving advice to some of my Clients, going through the ramifications with them.

I have worked out that these changes will potentially wipe out any profits for landlords with mortgage interest of 75%+ of their rental income, net of other expenses.

So, if you have a mortgaged property which you let, and have concerns about the new tax changes, simply give me a call or drop me an email for some advice so that we can help you make the right decisions.

 Contact Neil  for more details. Click Here

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