Landlords claim over £18bn in tax relief

Landlords clawed back £18.5bn in tax reliefs in the year ending 31 March 2022, says ludlowthompson.

The year previous, relief gained stood at £18.1bn.

The rise in the latest figure comes, the estate agent says, despite a reduction in the amount of relief landlords can claim on mortgage interest.

The most value claimed in the latest year was through loan interest and other financial costs, however, at £6.9bn, followed by property repairs, maintenance, and renewals, at £4.5bn.

Recently, the government detailed proposals to bring in a minimum EPC rating of C for new buy-to-let tenancies from 2025 and for all tenancies from 2028.

Many in the industry believe these proposals will be brought into law.

ludlowthompson says that landlords should make use of all available tax reliefs to prepare for this change but that care should be taken, “to ensure that improvements related to energy efficiency do not count as capital improvements, which would not be eligible for tax relief.”

Chairman Stephen Ludlow continues: “There are currently no specific reliefs available to help landlords improve the energy efficiency of their properties in time for the deadline.

“Landlords may be able to make careful use of the repairs, maintenance and renewal allowance to replace fixtures such as boilers with more energy-efficient models.”

“There is a strong argument that the government should provide more generous tax benefits for property improvements. This would incentivise landlords to make upgrades which would improve the overall quality of UK housing stock.”

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