Published: 12/11/2015I am sure that most landlords are aware of the buy to let ‘bombshell’ that was announced by the Chancellor in his Summer Budget… namely his proposal to allow income tax relief on buy to let finance costs at the basic rate of tax only. However, it may be helpful to comment further on how this change will impact the net returns of landlords, even though, for the moment at least, the developments remain as a proposal. But for those affected, rule changes two or three years down the line need to be considered now, then worked into a medium term finance strategy.
Alex Maile, Managing Director at Lawson Rutter, feels that; “It’s unlikely that these proposed tax changes will alter professional landlords long term strategy, but for those who remain private landlords because of the monthly income profit they provide, maybe now is the time to consider a sale. Any owner will want to avoid trying to sell when there’s a glut of property coming to market which could well be the case over the next year or two”
For landlords with a portfolio of properties, seeking expert advice now, and making plans regarding how best to restructure your affairs to minimise exposure to future tax obligations, is certainly the best course of action – whether by transferring your properties into a limited company, considering sales opportunities, or remaining with your current strategy.
If you would like to speak to one of our property rental experts please call us on 020 7731 3636 and we would be delighted to help. Alternatively, if you need legal advice about any of the topics raised in this article, please contact Stone Rowe Brewer LLP on 020 8891 6141.