Many mortgage brokers are now offering buy-to-let landlords who are purchasing or remortgaging property a free tax consultation to help them navigate the changing market as a result of the government’s cuts to landlord tax relief.
The existing rules that permit landlords to offset all of their mortgage interest against tax will, from this April, be phased out over the next three years until 2020/21.
Once mortgage interest relief has been withdrawn altogether, the consequences of Section 24 will mean that landlords will only be able to claim back a basic tax rate deduction of 20% off their tax bill, which will eat into their rental returns.
Promise Specialist Lending is the latest company to announce that it is to help brokers assist their landlord clients by providing a free telephone consultation with a tax expert.
According to Promise, the 15-minute consultation will help landlords understand the changes being made.
Steve Walker, managing director of Promise, said: “Landlords will be looking for advice and guidance on tax matters over the next few months and while brokers will no doubt want to be of service they know there are risks involved if they stray into giving tax advice when they are not qualified to do so.
“We hope this free service will be sufficient to answer client’s questions so brokers can recommend a mortgage without getting drawn into giving tax advice.”