Autumn Budget 2025 – Landlord Reactions
In somewhat good news for landlords, Chancellor Rachel Reeves decided against extending National Insurance to rental income in the Autumn Budget.
However, the Office for Budget Responsibility (OBR) warns that landlords will still be worse off under this Budget.
While National Insurance on rental income was not introduced, the Budget did raise tax rates on dividends, property, and savings income by 2 percentage points, which will increase the tax landlords pay on rental income and raise an estimated £500 million a year.
Successive eroding of private landlord returns will likely reduce the supply of rental property
In an embarrassing turn for the government, the OBR leaked key measures of the Budget, which it described as a “technical error,” while Ms Reeves blamed the OBR for the “serious error.”
The OBR document said: “The measures announced in this Budget reduce returns to private landlords, following various measures over the past 10 years that have also reduced returns.
“This successive eroding of private landlord returns will likely reduce the supply of rental property over the longer run, risking a steady, long-term rise in rents if demand outstrips supply.”
The OBR also mentioned changes to mortgage interest relief, the stamp duty land tax surcharge and capital gains tax allowances, as well as the introduction of the Renters’ Rights Act.
Rachel Reeves blames landlords
Industry experts have welcomed the Chancellor’s decision not to extend National Insurance on rental income.
Critics had warned that such a move could trigger property sell-offs and worsen the housing crisis for renters by pushing up rents.
While the Chancellor chose not to proceed with this change, the Autumn Budget still proved to be controversial for landlords.
Ms Reeves addressed fairness in the tax system, saying that a landlord with an income of £25,000 would pay nearly £1,200 less in tax than a tenant with the same salary because no National Insurance is charged on property, dividends, or savings income.
She said: “It’s not fair that the tax system treats different types of income so differently, and so I will increase the basic rate and higher rate on property, savings, and dividend income by 2 percentage points, and the additional rate on property and savings by 2 percentage points.”
Other measures in the Budget include:
The Freezing of personal tax thresholds for an additional three years from 2028-29
There will be a new High Value Council Tax surcharge of £2,500 on properties over £2m and a surcharge of £7,500 on properties valued over £5m
The two-child benefit cap will be abolished
The Conservatives’ ECO scheme surcharge on energy bills will be scrapped, saving the average household £150 per annum.
The OBR’s inflation forecast has reduced next year’s predicted inflation by 0.4% due to the affordability measures introduced in this Budget. This should increase pressure on the Bank of England to further bring down the Bank Base Rate.
Comments
Have Your Say
Every day, landlords who want to influence policy and share real-world experience add their voice here. Your perspective helps keep the debate balanced.
Not a member yet? Join In Seconds
Login with
Previous Article
Industry reactions to the "Mansion Tax"
Member Since July 2017 - Comments: 462
9:39 PM, 26th November 2025, About 5 months ago
I only have 2 properties left. Both will be gone by the autumn of 2026. For several years i have agreed with both my tenants that the latest CPI figure available, before the tenancy renewal rate, will be used to calculate their new rent. I also put in a maximum figure of 5% for any renewal, so that the increase should always be affordable.
When my last 2 properties have gone i will be concentrating even more on the stock market where it is easy to construct a portfolio yielding at least 6% where the dividend should increase at least keeping up with inflation. Do not worry too much about capital appreciation – it will only go to the government in IHT
The stock market is a fairly level playing field where the rules rarely change. And Rachel would like you to invest but at least pick a few UK companies to keep her happy!
Member Since December 2024 - Comments: 3
9:51 PM, 26th November 2025, About 5 months ago
Reply to the comment left by David at 26/11/2025 – 19:40
But the markets been strong up to recently? Why also sign up to oppressive mortgage deals when we’ve know since Osborne was Chancellor that it was open season for landlords. That was actually my trigger to start to sell up.
Hate to admit to being rather smug sat watching my predictions come true and also my assertiveness rewarded as I nestle in the front row of the freakshow with my cashpile – watching the sh**show unfold daily.
You’ll soon be handing your houses to tenants..or the keys to the bank.
Now, where’s my popcorn gone?
Good luck…you’re all gonna need it!
Member Since April 2018 - Comments: 374
9:59 PM, 26th November 2025, About 5 months ago
Reply to the comment left by Mark Ripley at 26/11/2025 – 21:51
You may be right Mark, but the property market has always bounced back even after the worst disasters. Inflation and interest rates have a way of rising in the UK so a short fix seems a good idea.Ideally I should have sold a year or so back.
Member Since April 2018 - Comments: 374
10:04 PM, 26th November 2025, About 5 months ago
Reply to the comment left by AnthonyJames at 26/11/2025 – 21:08
It’s tempting to sell everything and go on minimum wage, but jobs will now be even harder to find.
Member Since February 2022 - Comments: 71
10:42 PM, 26th November 2025, About 5 months ago
Reply to the comment left by Con Papapetrou at 26/11/2025 – 14:43
15%? How do you get 15%? What time period are you looking over?
Member Since September 2023 - Comments: 12
11:54 PM, 26th November 2025, About 5 months ago
Oh dear, this budget is a disaster for my tenants.
Some big rent increases incoming
Member Since November 2020 - Comments: 136
4:35 AM, 27th November 2025, About 5 months ago
Reply to the comment left by Valerie Hollylee at 26/11/2025 – 14:25
The difference is that those exempt from paying NIC will not be exempt from paying tax. She has us all by the short and curlies. Just one more nail in the coffin.
I calculate that my forthcoming April 2026 pension increase will be disappearing in taxes. I guess it’s an example of ‘Give and Take’.
Member Since November 2020 - Comments: 136
5:11 AM, 27th November 2025, About 5 months ago
Reply to the comment left by Mark Ripley at 26/11/2025 – 21:51
If you’ve sold up and sitting on a “sh**load of cash”, then why are you still reading and posting about a subject in which you have no interest? Just curious.
Member Since November 2020 - Comments: 136
5:13 AM, 27th November 2025, About 5 months ago
Reply to the comment left by Mark Ripley at 17:54
Can I respectfully ask, if you’ve sold up, why are you still here and posting?
Sorry, looks like I’ve already asked that same question in response to another of your postings. It’s still a valid question though.
Member Since May 2024 - Comments: 118
7:43 AM, 27th November 2025, About 5 months ago
More costs, more legislation but no increase in CGT. An obvious ‘go away small landlords and don’t let the back door hit you on the way out’.
The joke will be on them when they end up with a corporate PRS only interested in the luxury sector and the 1500000 extra social homes that don’t exist.