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10:56 AM, 20th January 2023, About A year ago 28
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A bid by a landlord to get the Government to reinstate tax relief allowing mortgage interest to be set against rental income has been shot down after the petition reached 28,000 signatures.
Simon Foster started the petition on the Government website to reinstate the full amount of mortgage interest against rental income before tax is calculated.
He told Property118: “This is a typical response from the government, and it makes me laugh when they say that they want to ensure tax is fair.
“Because it is landlords who have been screwed over the last few years making it tougher for all of us.”
He added: “It surprises me because there are probably loads of MPs with homes to rent and AirBnBs.
“A lot of landlords will be impacted by not offsetting their interest – if other businesses can, why can’t landlords?
“We need to keep on going and hopefully reach 100,000 signatures.”
However, HM Treasury has posted this response on the site:
The Government will continue to set mortgage interest relief against rental income at the basic rate of tax. The Government has a responsibility to make sure the income tax system is fair.
The Government recognises that the private rented sector plays an important role in the UK housing market and economy. However, the Government also has a responsibility to make sure that the income tax system is fair. Under the old system, residential landlords got relief on their finance costs (including mortgage interest payments) at their marginal rate of income tax, which meant that higher rate taxpayers got a more generous tax relief than those on lower incomes.
To address this, and make sure that all residential landlords are treated the same by the income tax system, the Government phased in a set of reforms to restrict finance cost relief to the equivalent of the basic rate of income tax. The reforms mean that all residential landlords will now receive the same amount of relief. It also reduces the disparity in income tax treatment between homeowners and landlords.
To minimise the impact on landlords who are affected, the Government chose to act in a proportionate and gradual way. It announced this change almost two years before its implementation. The restriction, introduced in April 2017, was phased in over four years to give landlords time to adjust to the changes.
To be clear, these reforms do not mean that tax relief on mortgage interest has been abolished. Landlords are still able to claim an income tax reduction equivalent to basic rate tax relief on the finance costs of their rental property. Residential landlords also continue to be able to claim relief at their marginal rate of income tax on the day-to-day costs incurred in letting out a property, such as letting agent fees and replacing furniture.
The Government understands that people, including those who rent property, are worried about the cost-of-living challenges ahead. That’s why decisive action has been taken to support households across the UK, whilst remaining fiscally responsible.
While that appears to be the end of the petition, it is still live on the Government website until May and if it reaches 100,000 signatures there is a chance that it will be debated in Parliament.
Mark Alexander, the founder of Property118, said: “It’s no surprise the government has responded in this way – and it’s a shame that private landlords still have their tax calculated initially against gross rental income without interest payment deductions – unlike any other business in the UK.
“I would urge all landlords who haven’t already done so to consider their tax situation as a matter of urgency.”
The petition can be found on the Government’s petition website.
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Crouchender
12:12 PM, 21st January 2023, About A year ago
I have tried with NRLA but again not interested in even raising awareness.
I think they are scared of the politically losing credibility with some of the stakeholders in Government.
Shame as I thought they represented our views as a NRLA member
Neil Patterson
14:06 PM, 21st January 2023, About A year ago
Reply to the comment left by Gary BTLowner at 21/01/2023 - 11:13
That is entirely incorrect and you have obviously not been following Property118very long.
We spent 2 years fighting the West Brom and won for all Landlords and then donated £11,000 towards the judicial review of Section 24 and supported all petitions over many years too numerous to mention that were utterly ignored by Government.
Despite Petition fatigue, I still published and promoted in the newsletter this Petition which was also sent out in the weekend newsletter.
We have always been at the forefront of fighting for landlords and when that doesn't work we find solutions unlike many others.
Jim
21:54 PM, 21st January 2023, About A year ago
Reply to the comment left by Helen Smitj at 19/01/2023 - 12:31Well said and I quite agree, a landlords association that won't even suport a landlord who has done an incredible job of getting 28,000 signatures to try and help other landlords.
They would not support my petition either when I tried to get the mortgage interest that was not claimable as a revenue or capital expense due to Section 24 to at least be claimed as a Capital expense. Their reason explained to me was that they were frightened of upsetting the Government in case they came back and did something even more nasty to landlords. Frightened!
Kay Landlord
8:24 AM, 22nd January 2023, About A year ago
Almost 30,000 signatures 🙂 it’s getting there another 70.000 and is achievable by May 2023
Why don’t you do a crowdfund ? Many members would be happy to support a wider campaign and if we keep lobbying the NRLA perhaps they might help too. What about the work the original guys did with the Judicial review - We are all n this together?
What government is just waking up to is their policy of destroying the PRS since 2015 has ultimately created more homelessness.
Richard Burton
8:29 AM, 22nd January 2023, About A year ago
Reply to the comment left by Gone Fishing at 19/01/2023 - 11:15
Totally agree with you Brian. We fit item one on your list.
Voice of a landlord
9:37 AM, 22nd January 2023, About A year ago
Simon has pipped me to the post on setting up this petition. Well done. We are on our way to make an impact on this subject.
To get to Well over 200,000 signatory requires the following strategies:
1) Canvas every estate agents to share with their client landlords. Many I have spoken are doing so already. But everyone on this forum. should do so also too.
2) canvas all resident landlord associations - the NRLA have been woefully slow and reluctant to participate in any form of hard negotiations with the government. I have spent last few months trying to persuade them to be the face of my petition with no success.
However if your a member of a landlord association lobby them to promote this petition. Its the weight of membership voices that activates change.
3) social media - need someone to really fan the fire with great contnous feeds.
4) tenant involvement - explain to your tenants cause of higher rents /low stock and they will sign up. Mine have.
Good luck and get activated.
Azad Peshderi
11:10 AM, 23rd January 2023, About A year ago
Hi All,
Is there a solution (i.e. incorporation) for small landlords with 3 BTL worth around 1 million with 75% LTV?
Pixie Props
13:05 PM, 23rd January 2023, About A year ago
Your wasting your time hoping that Government/Councils can be persuaded to treat you as serious business folk.
Ive seen and experienced the authorities trying to edge all PRS out and will give you nothing.
I was a serious Landlord/Proprietor with several homes great tenants paying below market value rents, I decided like many others on here that the authorities will beat me into submission. Shame because I had retired and had more time to devote to developing my business.
My advice is give up this campaign, find yourself a hobby, you'll get nothing! They pigeon hole you as Villains and wide-boys fleecing the system.