A new tax year begins tomorrow along with changes for buy-to-let landlords
Tomorrow the 6th April is a new tax year, it is when buy-to-let landlords will begin to feel the direct effects of the next tightening of taxation of the sector.
The Council of Mortgage Lenders (CML) in a recent news release headlined ‘Tax changes put more pressure on buy-to-let landlords’ point out that, from the 6th April 2017, tax relief on landlords’ mortgage costs will be restricted to the basic rate of income tax, and that over the next three years, the proportion of their borrowing costs that landlords can offset against tax will taper down to zero.
The ever increasing burden upon buy-to-let landlords includes a new raft of restrictions limiting what landlords can offset against tax, this follows the introduction of higher rates of stamp duty on property purchases by landlords. Landlords are affected by new rules restricting other deductible expenses that they incur from renting property, including reforms limiting tax relief for wear and tear in fully furnished properties, highlighted in the CML news release.
The government has published guidance and a series of worked case studies to assist landlords to work out the tax relief and assess the impact of the finance cost restriction.
Read the informative news release from CML in full click here.
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