NRLA commission London School of Economics survey on Landlord tax

NRLA commission London School of Economics survey on Landlord tax

11:49 AM, 20th December 2021, About 4 weeks ago 4

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Unsurprisingly, over half of private landlords responding to a new survey say recent tax changes in the rental market have had a negative impact on their investment plans. That’s the finding from a new study by the London School of Economics (LSE) for the National Residential Landlords Association (NRLA).

Based on responses from over 1,400 private landlords across England it finds that 52% say tax changes have deterred them from making further investment and acquiring more properties.

Recent changes have included restricting mortgage interest relief to the basic rate of income tax, a three per cent stamp duty levy on the purchase of additional homes and a decision to cut Capital Gains Tax to 18% for everything other than on gains from the sale of residential property.

Overall, a third of respondents said the reform to mortgage interest relief was the tax change having the greatest effect on the operation of their rental business. Of this group, 39% said the change meant that they were not proceeding with planned future purchases, whilst 31% said they had put plans on hold. 28% said they were taking steps to leave the sector altogether.

27% of landlords said that the stamp duty levy was significant; followed by changes in the tax treatment of furniture and fittings (26 per cent), and in the capital expenditure allowance (24 per cent).

 Ben Beadle, Chief Executive of the National Residential Landlords Association, said: “The NRLA will be studying this report carefully as it prepares detailed plans to support investment in the sector.

“That said, it is clear that recent tax increases have deterred investment in the sector. With the demand for homes to rent outstripping supply this will only hurt tenants as they face less choice, higher rents and find it more difficult to save for a home of their own as a result.”

Christine Whitehead, Emeritus Professor of Housing Economics at the London School of Economics and a co-author of the report said: “Our work on taxation of landlords across Europe (also in the report) suggests that as a result of the changes in taxation since 2015 individual landlords in Britain are being increasingly disadvantaged when compared to corporate landlords and other investment types”.



Comments

by Old Mrs Landlord

23:30 PM, 20th December 2021, About 4 weeks ago

A link to the study would have been helpful.

by Old Mrs Landlord

15:12 PM, 21st December 2021, About 4 weeks ago

Reply to the comment left by Martin at 21/12/2021 - 08:42
Thank you Martin. I expected to find it on the NRLA site but was disappointed.

by Old Mrs Landlord

15:34 PM, 21st December 2021, About 4 weeks ago

Reply to the comment left by Martin at 21/12/2021 - 08:42
Following your link to the Exective Summary I have now located a PDF of the full report: Private Landlords and Tax Changes; Scanlon, Whitehead and Blanc, 2021. Insufficient time to study it now but something to keep me busy over Christmas if our activities are restricted!


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