News

Alert to Landlords: Relief for Interest

Currently individual landlords receive tax relief at their highest rate of income tax on all of the interest they pay to finance their letting business. From April 2017 the amount of interest that will be eligible for tax relief at the marginal rate will be restricted to the following:

• 75% of the interest paid in 2017/18

• 50% of the interest paid in 2018/19

• 25% of the interest paid in 2019/20

The balance of the interest will be eligible for 20% tax relief in each case. From April 2020, only basic rate tax relief will be available for interest.

Tip: Review the funding structure for your buy-to-let business.

From Tait Walker’s ‘Summer Budget 2015’

 

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