Fifth of landlords still don’t understand tax changes – report

by: Christine Toner
  • 06/04/2017
  • 0
Fifth of landlords still don’t understand tax changes – report
A fifth of UK landlords don’t understand the implications of the government’s reduction in tax relief, despite the changes coming into effect today, a report has revealed.

According to Paragon Mortgages’ PRS Trends Report covering quarter one, 7% of landlords said they do not understand the changes which prevent them from being able to deduct mortgage interest costs from their taxable profits on property. Some 13% said they require more information.

The number of landlords who say they do understand the changes, however, has risen from 78% up from 71% in Q4 2016.

The report also found landlord optimism was stable in Q1 2017.

John Heron (pictured), managing director, Paragon Mortgages, said: “It’s encouraging to see that the PRS has not been negatively impacted to the degree that had been widely predicted, despite some turbulence over the last couple of years. This increase in understanding combined with effective financial planning may be the key drivers behind a steadier picture in terms of overall optimism among landlords.

“However, we remain cautious, as landlords will not be fully impacted for some years yet and, whilst we have been able to track a modest recovery in confidence since 2015, the sector is still some way off its peak; the PRS is finely balanced and will remain so for some time.”

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