In a continuation of our series supporting the RLA’s pleas to the Government, this blog is going to cover a couple of taxation topics. The first is a call for tax relief for carrying out works to comply with HMO conditions; next, a look at capital gains tax on active residential property investment businesses.
There have been a lot of regulation changes in recent years that have affected landlords and many of them have resulted in the landlord having to spend large amounts of money. An example of this is the changes to fire regulations which resulted in the necessity to update systems. In one house this was a significant expenditure but if you had a sizable portfolio the cost was nearly backbreaking. No one is questioning the need for top notch fire safety and we all approve of the law change. Given that it is a law, however, these kinds of things should result in tax relief for landlords. It is only fair.
The next suggestion the RLA has for the Government is one that I am completely behind. It is an urgent plea for those in charge to change the status of residential property investors who are actively involved in managing their businesses to that of trader. This would allow them to claim capital gains rollover relief for residential properties and, even better, taper relief. Landlords have been calling for this change for what seems like an age now and it appears to be falling on deaf ears.
As the true worth of the BTL sector to the British economy is slowly becoming apparent it would behoove the Government of this country to start taking some notice.
