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Tax Relief for Individual Landlords

If you would prefer to speak to us please call + 44 (0) 20 3700 8178

The tax relief that landlords of residential properties get for finance costs is being restricted to the basic rate of Income Tax. This is being phased in from 6 April 2017 and will be fully in place from 6 April 2020.

How is the tax reduction worked out?

The reduction is the basic rate value (currently 20%) of the lower of:

  1. Finance Costs - these are costs not deducted from rental income in the tax year (this will be a proportion of finance costs for the transitional years) plus any finance costs brought forward;
  2. Profits - the profits of the property business in the tax year after using any brought forward losses;
  3. Adjusted total income - this is the income (after losses and reliefs, and excluding savings and dividend income) that exceed your personal allowance.

What happens in the transitional years?

You’ll still be able to deduct some of your finance costs when you work out your taxable property profits during the transistional period. However, these deductions will be gradually withdrawn and replaced with a basic rate relief tax reduction.


If you would like us to call you, at a time to suit, please enter your details below with the best time / date to call you.  If you would prefer a meeting then we can make arrangements during the same call.

If you are ready to speak to us now then please call on + 44 (0) 20 3700 8178

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