The 2024 Budget Provides No Solutions for the Rent Crisis or Landlord Exodus

The 2024/25 Budget could have been the government’s chance to stop the landlord exodus that is tearing apart the UK’s rental market. Instead, it has done the opposite. At a time when landlords are leaving in droves and tenants are struggling to find affordable housing, the Chancellor has chosen to pile on more financial strain with an increased Stamp Duty Land Tax (SDLT) surcharge, and a stubborn freeze on Inheritance Tax (IHT) nil rate bands and introducing IHT on pension funds.

1. The SDLT Surcharge: A Punishing Increase for Landlords

In a Budget move that’s sent shockwaves through the landlord community, the Stamp Duty Land Tax (SDLT) surcharge on additional properties has been raised from 3% to 5%. This increase is a massive blow to landlords who are already grappling with rising costs and complex regulations. What was previously a steep surcharge has now become a prohibitive obstacle for small landlords looking to expand or even maintain their portfolios.

The Impact:

The 5% SDLT surcharge means landlords will pay significantly more upfront, making it harder to invest in new rental properties. This decision not only discourages small-scale landlords but also tilts the field even more in favour of large corporate investors who can more easily absorb these costs. For tenants, this shift is bound to impact rental supply, with fewer landlords entering or remaining in the market, inevitably driving up rent prices as housing becomes scarcer.

2. Freezing the IHT Nil Rate Band and Expanding IHT to Pensions

The Chancellor has once again frozen Inheritance Tax (IHT) nil rate bands. In real terms, this “freeze” effectively raises the tax for many, as inflation increases asset values without corresponding increases in tax-free thresholds. But perhaps most shocking is the decision to make pension funds subject to IHT, a move that will affect not only landlords but anyone with substantial retirement savings.

3. The Case for Indexation Allowance: A Missed Opportunity

The Chancellor’s failure to reinstate Indexation Allowance represents yet another missed opportunity to bring fairness back to the tax treatment of Capital Gains Tax (CGT) on property. Without Indexation Allowance, landlords are still paying CGT on “gains” driven by inflation, rather than real increases in property value. This means landlords are effectively taxed on money they haven’t truly earned, adding to the unfair burden of recent tax changes.

Where Do We Go From Here?

With this Budget failing to address the key issues that are driving landlords out of the market, it is vital that landlords come together to push for the tax reforms that are necessary to save the private rental sector. Without these changes, the landlord exodus will continue, putting more pressure on tenants and driving up rents.

Support Property118: Fighting for Fairer Tax Treatment

Now more than ever, it’s time for landlords to come together and demand the fair tax treatment they deserve. With the right reforms, the private rental sector can thrive once again—without them, we risk a complete collapse.

At Property118, we are dedicated to fighting for the fair tax treatment landlords deserve. Whether it’s reinstating Indexation Allowance, addressing the unfairness of dividend tax rates, or restoring mortgage interest relief, we are committed to pushing for the reforms that will keep landlords in the market and ensure affordable housing for tenants.

We need your support to continue this fight. By contributing to our campaign, you can help us bring about the tax reforms that will safeguard the private rental sector.

Every donation counts. Use the form below to help us fight for a fairer tax system for landlords across the UK.

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