Attention landlords! An additional tax change is set for April 2017. This among the recent changes in stamp duty will affect you so it’s important that you stay informed. As it currently stands, landlords are able to claim tax relief on their mortgage interest payments based on their rate of tax.

The question on everybody’s mind at the moment is ‘What is the intention behind the introduction of these new rules and regulations?’ The government are trying to cooldown the overheating buy-to-let market in an attempt to make the property ladder more accessible for first buyers. However, according to the National Association of Estate Agents 85 per cent of their members have noticed an increase in landlords buying property prior to this month’s new tax hikes which have just come into effect.

Some taxpayers receive 20 per cent of tax relief (basic rate), while others are able to obtain 45 per cent. As of April next year, this will decrease to 20 per cent only. Those on the top end of the scale will see a significant cut to their relief. This means tougher lending criteria will be applied to landlords looking to obtain a mortgage for their buy-to-let properties.

Simply Business states that 'until now, landlords have typically required a 25 per cent deposit to get a buy-to-let mortgage. They have also needed the rent to cover their monthly mortgage payments by 125 per cent'. For professional advice on the changes to buy-to-let tax relief, contact the office and we can put you in touch with our associated accountants.

 

Wonderlease

It's the lease we can do

 

Ask for Marc or Richard: 0208 509 3000 1 Station Approach, Hoe Street, Walthamstow, London E17 9QF

 

info@wonderlease.co.uk

Published on 01 April 2016

Source Wonderlease

Written by Marc Cohen

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