Industry expert urges Chancellor to help landlords and tenants in Autumn Statement

Industry expert urges Chancellor to help landlords and tenants in Autumn Statement

10:24 AM, 17th November 2023, About 6 months ago 15

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The Chancellor will unveil his Autumn statement next week and one industry expert is urging for “swift and specific” measures to help landlords and tenants.

Neil Cobbold, the managing director of PayProp UK, is calling on Jeremy Hunt to reduce taxes for landlords and to unfreeze the local housing allowance.

According to the Institute for Fiscal Studies, rents in the private rented sector have increased by more than a fifth.

Tenants and landlords struggling

Mr Cobbold said: “There are tenants and landlords struggling in the Private Rented Sector (PRS) who require swift and specific measures from the Chancellor.

“The Local Housing Allowance has not been increased since April 2020. And last year, the government confirmed that the current freeze on housing benefit payments would continue into 2023/4.”

Mr Cobbold said while some landlords are retiring and selling their properties to fund it, others who continue as landlords are facing high mortgage costs, increased regulation and a heavy tax burden, which may put them in an untenable position.

Currently, all rental income made from a property is taxed – landlords can partially claim back mortgage interest costs, but only up to the basic tax rate of 20%.

Mr Cobbold said many landlords are calling for the scrapping of Section 24 but it seems unlikely that the Chancellor will consider it for his Autumn statement.

He said: “Many have called for the abolition of Section 24, but it seems unlikely that the Chancellor is going to consider it this time around – even though it creates an incentive for higher-rate tax-payer landlords to incorporate their properties as a way to claim mortgage costs as an expense and pay corporation tax at 25%, rather than the 40% or 45% personal tax rate on their rental income.

“As a result, some landlords are now selling their properties.”

Extending the first-time buyer’s stamp duty land tax

He added: “A measure the government could consider is extending the first-time buyer’s Stamp Duty Land Tax relief to tenants who don’t own a home and have been renting for more than 12 months, to prevent wealthy buyers renting for a few months to take advantage.

“This could encourage tenants who have previously owned or inherited property and subsequently sold it, or who have married someone who previously owned property to take advantage of the tax saving and consider buying instead of renting.

“The resulting reduction in demand for rental properties could also help cool rent price increases for other tenants.”

Reduce capital gains tax

He added the Chancellor needs to introduce tax incentives to landlords.

He said: “Another measure the Chancellor could introduce, to ensure as many PRS properties as possible remain in the sector, is to incentivise landlords that need to reduce their stock to sell to other PRS landlords.

“To achieve this, the Chancellor could reduce Capital Gains Tax for landlords who sell their properties to other landlords who commit to keeping it in the PRS for a fixed number of years.

“A measure like this would also stimulate the sales market to some degree, but the main advantage would be in retaining as many properties as possible in the rental market.


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Comments

Robin Pearce

14:20 PM, 18th November 2023, About 6 months ago

Reply to the comment left by HC Mann at 18/11/2023 - 13:47
"You keep calling it "an invasion" yet these are legal migrations to the uk in order to fill jobs."

Illegal immigration is an invasion.

Ref legal migration
*Almost every courier driver now E.European
*Every barber now Turkish or Albanian or whatever
*Every petrol station attendant Indian
*Every taxi driver foreign.
Whilst 1.5m Brits are unemployed
Overpopulating us by importing low paid workers who aren't even net contributors as they don't earn enough to pay much tax, really makes sense doesn't it ? 🤔

"Far too many people have retired early and no longer economically active, having ransacked the next generation of all their wealth through what should be completely illegal "buy to let", "

Where are people who might be in a city for a couple of years, or choose not to rent or even only in the country for a couple of years, meant to live if no rental sector?
In hotels ?

I'm selling one BTL a year to retire. I always offer then to tenant.
This year tenant said he didn't want to buy it even though he could get a mortgage if he wanted to, as property market might crash.
So it's fine for landlords to take that risk of owning property that might drop in value & run the risk of bad tenants etc, but not him.
That's his choice.

"Far too many people have retired early and no longer economically active, having ransacked the next generation of all their wealth "

Retirement age increased by 6 years for women & two years for men. Not enough old for you?
Are people meant to work until they die ?

You've completely overlooked the fact that we need 5000 new homes a week just to keep pace with legal net migration last year at 606k. So why scapegoat landlords for lack of housing. Landlord don't take property out of use. They don't alter the ratio of number of homes to population size. Mass immigration does that.

Lots of young people choose foreign holidays, gym fees, nearly new car, latest Iphone etc over saving up for a deposit.
Wife & I scrimped & saved. Ran an old car etc to save deposit to buy a house in 1978. Then bought or got given 2nd hand furniture, an old TV etc to put in it
Interest rates were higher then. We still managed.
We made prioritised having our own roof over our heads more than other things.

Easy rider

14:25 PM, 18th November 2023, About 6 months ago

Reply to the comment left by HC Mann at 18/11/2023 - 13:47
The ‘invasion’ are the economic migrants and those feigning persecution.

The government should not allow people smugglers to decide who comes to the U.K. and who does not.

Instead of marching around London and causing huge cost to taxpayer, the protestors should go to their beloved countries and fight for them.

Net migration needs to be managed. Schools, hospitals, sewerage systems, water supplies, suitable work opportunities all need to be in place BEFORE we invite people to come to the U.K.

Robin Pearce

14:30 PM, 18th November 2023, About 6 months ago

Reply to the comment left by Easy rider at 18/11/2023 - 14:25
UKs overcrowded. We got enough car washers, delivery drivers &Turkish barbers we don't have enough homes for +1.6m unemployed.
We do not need or want further population increase
Englands' already the most densely populated large country in Europe. Urban sprawl going on everywhere. Traffic grinding to a halt. Flooding due to building on low lying land etc
Higher GDP due to more people is no more GDP/capita.
Net mig'n needs to be NIL.
1 in 1 out & only best let in with skills we need on min £35k salary or they're not net contributors https://www.youtube.com/watch?v=4ayA0neqzRs&t=674s

Easy rider

15:20 PM, 18th November 2023, About 6 months ago

Reply to the comment left by HC Mann at 18/11/2023 - 14:2933k officially across the channel is small boats. The number is higher. Then there’s the thousands crossing in lorries.

The Right to Rent checks are the government’s way of stopping the illegal migrants renting property. It doesn’t stop them. Most landlords probably don’t do the checks. There’ll be people that pass the checks posing as wannabe tenants for others.

john thompson

20:10 PM, 18th November 2023, About 6 months ago

Reply to the comment left by Robin Pearce at 17/11/2023 - 22:14
Labour will definitely not reduce any immigration, they will completely open the borders and flood the country.

If anyone thought immigration was out of control wait till Labour woke clowns get in, the s**t really will hit the fan then.

Makes me wonder how bad the housing crisis will decend before they even think about or admit to the immigration connection to the shortage, and then will they actually stop the childish hate mongering and think about welcoming landlords back as home providers once most of us have bu***rd off.
Either way, once I sell off I will never get into homing residential tennants again, the anger and wounds are too deep now!

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