Landlords are not all rich – two thirds paying basic rate income tax!

Two-thirds of individual landlords are only liable for the basic rate of income tax according to data released by the Government.

The Residential Landlords Association says that it challenges the myth that landlords have large incomes and so can cope with tax rises.

According to the figures obtained in response to parliamentary questions from DUP MP Jim Shannon, of the just over 1.9m unincorporated individual landlords returning a self-assessment tax return, two-thirds were in the basic rate bracket, 30% were in the higher rate band and 4% paid the additional rate.

Treasury minister Mel Stride also confirmed that landlords are taxed more than home owners, noting that they pay tax on their rental income, extra Stamp Duty and Capital Gains Tax.

The RLA said that this “killed off” assertions by former Chancellor George Osborne that tax rises on private landlords were about levelling the playing field with home owners.

In another answer, however, the Treasury re-asserted that it estimates only one in five landlords will be affected by the reduction in mortgage interest relief.

The RLA, which disputes this, said it wants the Government “to scrap the decision to tax a landlord’s turnover, rather than profit, abandon the mortgage interest relief changes and to no longer apply the Stamp Duty levy on additional homes where a property is adding to the supply of housing available to rent”.

RLA chairman Alan Ward said: “We need more homes to rent to meet growing demand. It is time that the tax system encourages rather than stopped housing growth.”


Source: Property Industry Eye

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