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The Autumn Statement was delivered on 22nd November by the Chancellor, Jeremy Hunt, who outlined the government's plans to put UK economy “back on track”. Whilst there was no mention of the Renters Reform Bill, landlords may be pleased to hear of some of the other unexpected measures. Below we have outlined what may affect you as a landlord.
Capital Gains Tax
Hunt has decided to move forward with Capital Gains Tax plans from 2022's Autumn statement despite hopes it would be overturned. This means tax free allowance will half again in April 2024 to £3,000. For landlords looking to sell, more profits will be taxed.
Check out our blog post "Housing Crisis: Should Landlords Hold, Sell or Buy" if you're considering selling to determine what the right thing for you is.
Support For Tenants On Lowest Incomes
Rent accounts for more than half the living costs of tenants on the lowest incomes. The LHA (Local Housing Allowance) is set to increase to cover the lowest 30 per cent of rents across the country, providing support for people to stay in their homes. This will, hopefully, reduce the number of rent arrears that a landlord will have to deal with in the future.
Stamp Duty Surcharge
The Chancellor has announced plans to keep the current thresholds in place until March 2025 despite hopes that we would see a change to stamp duties and increased thresholds in attempts to support first time buyers. However, landlords and second-home owners will still see the additional 3% stamp duty.
Property Conversions
For landlords and investors interested in converting properties, it's positive news. Jeremy Hunt has confirmed a new discourse on the Permitted Development Rights (PDR) in which views on converting house from one to two flats will be discussed, considering that the external appearance remains the same.
National Insurance Cuts
The Chancellor has announced the abolishment of Class 2 National Insurance Contributions. This tax plan is to help businesses and workers but there has also been talk of personal tax cuts to follow in Spring 2024.
This tax cut will benefit landlords who are classified as self employed; in other words, being a landlord is your main job and you make profits of at least £6,275 a year. If you fall into this category, you will no longer have to pay £3.45 a week, starting in April 2024, saving you £192 a year as recognition of your efforts towards the economy.
At Elliot Leigh Guaranteed Rent, we also recognise your efforts towards the economy and we know that being a landlord comes with a lot of extra work, ranging from referencing to maintenance and everything in between. That's why we strive to make being a landlord hassle-free. Find out how here.