Issue 9: Property Matters Newsletter
28th January 2026
What To Expect In Issue 9 of Our Property Matters Newsletter
The November 2025 Budget certainly had a few surprises for landlords, however is this in itself a surprise now for the sector?
Looking back, since 2017 there have been many changes which have greatly affected landlords, whether this relates to the phase in of restrictions for the claim for mortgage interest relief, moving from a 100% allowance to what will be a restricted 22% from April 2026. Of course, this falls into line with the increased levels of taxation, with a 2% increase on profits arising for basic rate, higher rate and additional rate taxpayers. This increase does bring into question the complexity of the UK tax system, and at a recent forum that I attended, I raised the question of the number of tax rates that are soon to be in operation, and the result of totalling all of those rates up was a surprise to everyone attending.
Important Tax Changes for Landlords – Effective April 2027
Just looking at Income Tax, property and savings tax and then dividends, there will be 13 different rates which will need to be considered, and my colleague Ben Golding provides further insight as to the effects that some of this will bring.
There has been the abolition of the furnished holiday let regime, which has influenced both capital gains and Inheritance Tax matters for some individuals. In addition, there has been the tightening and abolition of the beneficial capital gains Letting Relief.
One recent announcement by the government in relation to the increased limits from £1 million to £2.5 million for the inheritance tax, agricultural and business relief, together with the availability of spousal transfer is a welcome move. However, the residential nil rate band of £175,000 remains low, and remains a relief that can be easily lost due to the value of the estate and also through the conditions of the relief, but perhaps most importantly through a reluctance of IHT planning with the main residence.
Wear and Tear Allowance was abolished and, in its place, came the replacement basis, which means that the first purchase of white goods wasn’t allowed, but their replacement is.
Making Tax Digital for Income Tax Begins 6 April 2026
Finally, we have the introduction of Making Tax Digital for Income Tax, and the increased record keeping and reporting that this will bring. My colleague Richard Alecock provides more details on what will be the biggest change for individuals since the introduction of Self-Assessment last century.
Tax Relief on your Garden
An ongoing topic of discussion has been the pledge to build more houses, and it has been noticed that individuals are now benefiting from this wish, by selling off part of their gardens. As you would expect, this does come with its own complications, and my colleague Shamus Chaplin explains matters further.
Mansion Tax Explained
Finally, for those that “own mansions”, you will be interested to read my colleagues Daniel Walker’s words on what this will mean to you if this were to be introduced. It perhaps isn’t as harsh as the Window Tax of 1696, but it may have some similar effects upon people’s future property purchases.
Get In Touch
If you wish to discuss any of the matters covered in this newsletter, please do get in touch with your usual Whitings contact, the author of the article or alternatively your local Whitings office, and we will be happy to help you.
