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Next year's buy to let tax change will hit almost half a million

The National Landlords Association claims that changes to buy to let mortgage interest tax relief being introduced in six months time will hit well over 400,000 people. 

It says some 22 per cent of landlords who pay the basic rate of tax will be forced into a higher tax bracket from April; the changes - which will be fully phased in by 2021 - will then mean landlords will no longer be able to deduct mortgage interest payments or any other finance-related costs from their turnover before declaring their taxable income.

Currently, mortgage interest payments are one of a number of expenses that landlords can deduct as a business cost, including insurance premiums, letting agent fees, and maintenance and property repair costs.

However, the NLA claims that while 440,000 basic-rate tax payers will be forced into a higher bracket, all landlords could be at risk of seeing their tax liability increase regardless of their existing rate of tax.

The amount by which landlords will be affected will depend on their personal circumstances, including whether or not they generate income from any other sources.

Landlords’ tax liability will increase depending on their existing annual mortgage interest payments, which are broken down by portfolio size:

Single property - £3,600

2-3 properties - £8,600

4-5 properties- £16,300

5-10 properties - £18,200

11-19 properties - £24,900

20+ properties - £38,000

The NLA has met with housing minister Gavin Barwell to discuss the issue and is attempting to meet with Financial Secretary to the Treasury Jane Ellison - she is responsible for strategic oversight of the UK tax system including direct, indirect, business, property and personal taxation.

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    Single property - £3,600
    2-3 properties - £8,600
    4-5 properties- £16,300
    5-10 properties - £18,200
    11-19 properties - £24,900
    20+ properties - £38,000

    Is this a bit of exaggeration for the sake of emphasis?

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