mapheader

Your London Guaranteed Rent Specialists

Your London Guaranteed Rent Specialists

Buy-to-let tax relief changes drive landlords to set up limited companies

Buy-to-let landlords are moving to set up limited companies to minimise the impact of mortgage tax relief changes due to take place next year.  

Buy-to-let tax relief changes drive landlords to set up limited companiesAccording to new research, landlords are also increasing rents in an attempt to prevent a reduction in their income profits.

As many as one in ten landlords have already transferred their property to a family member, while one in four landlords are considering such a move.

At the moment, landlords can claim tax relief on the top rate of tax up to 45%. From April 2017, the basic rate of tax relief landlords can claim will fall to 20%.

Property investors have suffered particularly in 2016, with measures designed to curb the growth of the buy-to-let sector.

In April this year, an extra 3% stamp duty surcharge came into affect which hit buy-to-let investors and second home purchasers. In addition, the wear and tear allowance for landlords has been scrapped. The Bank of England’s Financial Policy Committee has also been granted new powers to help regulate the sector.

Such measures are affecting the rental market, which in turn won’t help first-time buyers or tenants.

For more on this story, click on the link below:

What Mortgage