In the controversial summer budget, the Chancellor George Osborne announced that Mortgage Interest Relief for residential landlords would be restricted to the basic rate of income tax (20%). Landlords would also no longer be entitled to an automatic entitlement to a wear and tear allowance (currently at 10%) for furnished properties, leaving them with no recompense for general wear and tear of a property. 

This new change doesn't just affect 'higher rate tax payers' as for some landlords, without being able to off-set the interest element of a BTL mortgage will tip them over into the higher rate band. 

The link to sign the petition is here 

The IFS (Institute of Fiscal Studies) has said outright that 'the Treasury’s budget analysis on the rental market is “plain wrong”. See the full article here

Although it is looking unlikely the Government will do a U-turn on this tax change, the more signatures this petition gets the bigger the impact it will have.

There is however a glimmer of hope as the Residential Landlords Association have been asked by the Treasury to propose alternative 'tax solutions', so they are encouraging Landlords and Letting Agents to email their tax relief ideas to [email protected]. The RLA is to take any proposals it receives back to the Treasury next month, so please don't delay if you have any good ideas. 

More from Property Industry Eye on this topic here  

Furthermore, a consultation was launched in July by HMRC on the scrapping of the 10% wear and tear allowance which runs out on October 9th 2015, more information and to submit your concerns please click here

As you can see there is lots going on at the moment, but the overall message right now is get professional advice as soon as possible from your accountant or speak to our accountants - Morgan Hemp Accountants