Landlords claimed £17.5 billion in buy to let tax breaks last year – and despite plans to increase taxes, landlords will still be handed billions by the state to subsidise their property rental businesses.
Freedom of information data broke the amount down in to landlord claims for £7 billion of relief of mortgage interest payments and £3.7 billion for property repairs and maintenance.
Even though the government expects to grab an extra £840 million a year by reducing the amount they can claim against mortgage interest relief, landlords paying basic rate tax should still be able to claim at least £6.4 billion on mortgage interest payments.
Stephen Ludlow, chairman of Ludlow Thompson said: “Despite tightening, buy-to-let tax breaks are still very valuable, highlighting that rental property remains a highly attractive investment vehicle.
“Those tax breaks are essential to ensure that landlords continue to invest in maintaining their properties. If the tax breaks are reduced further then landlords will cut their investment in the properties they own – reducing the standard of UK rental accommodation.”
Meanwhile, in a separate survey, it has been revealed one in five landlords is thinking abut selling their rental property this year.
They cite mortgage interest relief restrictions, a 3% surcharge on stamp duty and banning buy to let upfront fees as the main reasons.