iHowz manifesto: rent-free proposal and tax fairness for landlords

A landlord organisation has released a manifesto outlining 14 recommendations including a bold reform for Section 21.

ihowz says the recommendations aim to create a fair and efficient rental market that works for landlords and tenants.

Recommendations include fair taxation for landlords and training for landlords and tenants.

Two months

Rather than abolish Section 21, ihowz calls for it to be amended.

In a bold proposal, the organisation suggests tenants get the last two months of their tenancy rent-free if a Section 21 is issued.

ihowz explains the rationale behind this radical proposal:

The rent which would have been paid to the Landlord would cover:

• The rent in advance and/or deposit at the new Property.
• Any costs of removal.
• It would follow that the tenant’s deposit would be returned at the end of the tenancy.

ihowz adds: “By adopting this particular radical proposal and avoiding the abolition of Section 21, it would avoid the necessity for landlords to make an application to Court in the event they wish to sell their Property; thus, saving much court time, expense, and anxiety for the tenant.

“It would, of course, continue to provide the much-needed safety mechanism of Section 21 evictions in the event of abhorrent ASB.”

“This removes the fear of eviction, as all tenants will be safe in the knowledge that their costs of moving, and out of pocket expenses, are underwritten by their landlord in the event a Section 21 notice is served.”

Landlords should be taxed fairly

ihowz also says landlords should be taxed fairly and similarly to other investors and self-employed businesses.

The manifesto says: “Landlords should be allowed to roll-over the Capital Gains Tax (CGT) tax.

“Landlords should not be required to pay a surcharge on normal capital gains.  Similarly, they should not be required to pay an additional Stamp Duty on each additional property purchased.

“Interest payments on mortgages for rental properties should be treated as a fully allowable expense when calculating a landlord’s taxable income, as they were prior to 2016.”

National standard

ihowz proposes introducing a national standard that would apply to private, social, and council housing.

The organisation suggests that every rental property should meet certain conditions when it’s put on the market and rented out.

Under ihowz’s manifesto, landlords would need to get a Rental Safety Certificate. This certificate would include essential documents such as a gas inspection report, an Energy Performance Certificate (EPC), and an electrical safety certificate.

ihowz says if landlords do not meet these standards then tenants should have the right to report breaches to the Local Authority.

The organisation says: “Tenants have inherent security of tenure, and they should not be in fear of eviction if they report unsatisfactory conditions, as the Deregulation Act 2015 prevents retaliatory evictions.”

Licensing has cost landlords large sums of money

Another pledge includes establishing a register for all rental properties with a Redress Scheme to ensure accountability.

ihowz argues introducing a register would be a better alternative to licensing.

The organisation says: “Licensing in its many forms has cost landlords large sums of money for little benefit and inconsistent reporting of outcomes.

“Although all discretionary schemes were designed for a fixed period, very many Local Authorities have renewed them and clearly see them as an income producer.

“If the national rental property standard were introduced, licensing would be unnecessary, apart from the original reason – to control the small number of poorly managed properties.

“Additionally, the introduction of a Redress Scheme (similar to the current agents’ scheme) would further negate the need for licensing, where tenants should be made to pay a small application fee, which would be fully refundable if their complaint were upheld, this would minimise the inevitable vexatious claims made.”

Tenant training

ihowz also encourages tenants to take training courses to understand their rights and responsibilities.

ihowz explains: “Tenants should be encouraged to take tenant training and accreditation.

“It would provide tenants with education about the housing system in the country, they would better understand their rights and responsibilities (e.g. mould – what causes it, what should your landlord do to prevent it, what should you (the tenant) do to avoid it).”

ihowz also suggests that self-managing landlords should take professional accreditation training.

Reform court system

ihowz also wants to reform the court system by streamlining the eviction process.

The manifesto says: “If a landlord serves a Section 8 eviction notice for provable rent arrears, and the tenant refuses to leave it is currently necessary to hold a full court hearing.

“All too frequently these hearings are not attended by the tenant to hear judgment made against them.

“This is a waste of the courts, and the landlords’ time and money.

“If the rent arrears are more than the appropriate amount (currently 2 months), and are fully provable, there should be no need for a court hearing if the arrears are unopposed.”

The full 14 recommendations from ihowz can be found here.

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