Government urged to deliver Budget tax relief for landlords

Government urged to deliver Budget tax relief for landlords

0:01 AM, 18th October 2024, About 3 hours ago

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Organisations representing landlords and agents have issued a plea to the Chancellor Rachel Reeves for urgent tax breaks to help alleviate the housing crisis and curb rising rents.

In a letter ahead of the Budget, the organisations are highlighting the ‘severe shortage of homes’ and the ‘uncertainty on a number of fronts’ facing landlords.

The letter, which has Goodlord, the National Residential Landlords Association, the Large Agents Representation Group and Propertymark as signatories, urges the government to re-evaluate the taxation of the rental sector.

They point to observations by Paul Johnson, director of the Institute for Fiscal Studies, that the current taxation of the PRS contributes to rising rents and is ‘increasingly penal’.

Tax reductions for landlords

The call for tax reductions for landlords comes as the government wants up to £40 billion to be raised through spending cuts and tax rises.

A potential rise in Capital Gains Tax which could hit landlords was also highlighted as a concern.

The letter proposes several measures to encourage landlords to invest in the PRS and increase the supply of homes. These include:

  • Abolishing the 3% stamp duty levy on properties bought for renting when the landlord refurbishes an empty property
  • Removing the landlord levy for investing in projects that boost the net supply of rented housing
  • Ensure that the Local Housing Allowance remains pegged to at least the 30th percentile in this Parliament.

The challenges faced by landlords

The letter also emphasises the challenges faced by landlords from the Renters’ Rights Bill, which will abolish Section 21 ‘no-fault’ evictions and introduce other tenant protections.

This will, the letter writers state, be ‘the biggest set of changes the market has seen in over 50 years’.

The PRS also needs a ‘clear plan’ for improving rented home energy efficiency.

There’s also a warning that the government’s aim of building more homes to rent is not the ‘complete solution to the sector’s challenges’.

The letter also warns that completion rates in the build-to-rent sector are not keeping up with the current level of landlords leaving the PRS.


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