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Changes on the horizon

What to expect from the new Labour government

What tax changes should we expect under the newly elected Labour government? Significant policy shifts are on the horizon, particularly in the area of housing and property investment


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As the newly elected Labour government settles into office, significant policy shifts are on the horizon, particularly in the area of housing and property investment

This article explores potential tax changes that could impact landlords. Whether you own a single rental property or a large portfolio, staying informed about these possible changes is crucial for strategic planning.

Reintroduction of rent control measures

One of the cornerstone policies of the Labour party has been the introduction of rent controls. While this doesn’t directly affect taxes, the implications on rental income could indirectly influence your tax liabilities. Rent caps or freezes may limit rental income growth, which could subsequently affect the profitability and tax position of your investments.

Changes to Capital Gains Tax (CGT)

The Labour party has signalled a potential increase in Capital Gains Tax (CGT) rates for property sales, aligning them more closely with Income Tax rates. This could mean higher taxes when selling rental properties, especially if they have appreciated significantly in value. Currently, the top rate for CGT on property sales is 24%, but this could rise significantly under new legislation.

Revisions to mortgage interest deductibility

Another key area of focus could be the treatment of mortgage interest payments. The Labour government may further limit or completely remove the ability to deduct mortgage interest from rental income for tax purposes. This policy has been gradually phased in under the previous government, and further restrictions could make it more expensive for landlords to finance properties.

Property and wealth taxes

There is speculation that the new government might introduce or increase property taxes or consider a wealth tax targeting high-value property portfolios. These changes aim to address wealth inequality but could lead to higher annual costs for property owners, especially those with extensive holdings.

Stamp Duty Land Tax (SDLT) adjustments

Labour has expressed interest in reforming Stamp Duty Land Tax, potentially increasing rates for buy-to-let properties and second homes. This could deter new investment and make it more expensive to expand your property portfolio.

Incentives for energy efficiency improvements

On a positive note, the Labour government has also proposed incentives for landlords who improve the energy efficiency of their properties. This might include tax reliefs or grants for making eco-friendly upgrades, aligning with broader environmental goals.

Planning ahead

Given the potential for significant changes, it’s advisable to consult with a tax advisor or financial planner to understand how these proposals could impact your personal and business finances. Strategic decisions, such as timing property sales or making capital improvements, may need to be reconsidered in light of new tax laws.

Stay tuned for further updates as more concrete details emerge from the Labour government. In the meantime, staying informed and prepared is the best way to navigate the changing landscape.


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The information contained in this article is believed to be correct at the time of publication. The content of this article is intended to be a brief summary of the principal points of the legislation or proposed legislation only, and it is provided for general guidance only. It may not take into account subsequent changes in the law and of necessity it omits much detail. Taxation is a complicated subject and is subject to change. You should only rely on advice prepared specifically for you. Neither the writer nor Landlords Tax Services Ltd can be held liable for any loss arising from any act or omission by you as a result of your understanding of this article. If the subject matter is of interest you should contact us to see if there is a relevant update, and to take professional advice which takes into account your circumstances.

What tax changes should we expect under the newly elected Labour government? Significant policy shifts are on the horizon, particularly in the area of housing and property investment

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