Latest update on new landlord tax on mortgage interest relief

A group of Tory peers have thrown their weight behind the RLA’s campaign opposing George Osborne’s plans to cut Mortgage Interest Relief for landlords.

In an article for The Times Lord Flight, Lord Howard, Lord Lytton and Lord Cathcart said the Government’s assault on private-sector landlords is ‘misguided’ and will make the UK housing crisis worse, forcing up rents and making it harder than ever for tenants to save for a deposit.

Like the RLA the Lords challenge the chancellor’s claim that restricting Mortgage Interest Relief for landlords to the basic rate of income tax, will ‘level the playing field’ between landlords and homeowners.

An RLA survey of more than 1,200 landlords revealed that of those paying the basic rate of income tax, more than 60 per cent said that the changes would push them into a higher rate of tax despite their income not increasing. This will almost inevitably push up rents.

The RLA has been relentless campaigning to challenge the proposed restrictions and the campaign is starting to make an impact among Tory backbenchers – with a surge of support. The RLA met Treasury Minister Lord O’Neill on the 3rd May. Representatives have also met with a number of influential Conservative backbenchers including Graham Brady, chair of the 1922 committee and the former Secretary of State for Wales David Jones MP.

David Jones MP produced an article for Conservative Home expressing his concerns about the changes following a meeting with the RLA, with Graham Brady quoted in the Daily Telegraph expressing ‘serious concerns’ about the plans.

Mark Field MP wrote an article for City AM in which he warned that the changes would hit domestic buyers hard and could result in rent hikes, with landlords passing costs on to tenants. And Conservative peer Lord Flight has publicly backed the RLA campaign, writing an article for the Daily Telegraph in which he claimed attacking buy-to-let would worsen the UK’s housing crisis.

Landlords Steve Bolton and Chris Cooper who are currently seeking consent to initiate a judicial review on George Osborne’s MIR proposals this week extended their fundraising deadline until the end of August. The RLA has provided financial support to the campaign as well as offering access to the RLAs body of research and legal advice. And RLA policy director David Smith addressed the recent Tenants Tax Summit for supporters.

The campaigners are trying to raise £250,000 in total to fund the judicial review – if it is given the go-ahead. In all just over £108,000 has been raised so far. While the RLA’s actions are already seeing results it is important keep up the pressure, especially on Conservative MPs.

More than 400 RLA members have already written to their MP about MIR and the association is now urging those landlords who haven’t to do so now. The next step is to arrange face to face meetings with MPs to spell out the potentially devastating impact these cuts will have on both landlords and tenants.

The RLA’s position is clear. Mortgage interest is a legitimate business expense and should carry full relief. We will continue to fight this unfair tax-grab on behalf of our members and have a meeting already scheduled with the Prime Minister’s new housing advisor in July.

Learn how to beat the landlords tax with this new book
landlordinterest

Written by: Houseladder