Autumn Statement 2023 – What Landlords Need To Know

Chancellor Jeremy Hunt’s much-anticipated Autumn Statement has unveiled a mix of surprises and expected measures, with implications for landlords across the country. Let’s delve into the key points that could shape the landscape for property owners and investors.

Full-time Landlords Get A National Insurance Boost

In a bid to support businesses and workers, the Chancellor announced a tax plan that includes a significant benefit for full-time landlords. The abolition of Class 2 National Insurance contributions for the self-employed means self-employed taxpayers, including landlords whose main job is property rental, will save £3.45 per week starting April 2024. This move is estimated to save the average self-employed individual £192 annually.

Support for Tenants On The Lowest Incomes

Recognising the impact of rent on low-income tenants, the Treasury has pledged to increase the Local Housing Allowance (LHA). This increase aims to cover the lowest 30% of rents nationwide, providing crucial support for tenants to stay in their homes. Approximately 1.6 million households are expected to receive an average of £800 in extra support next year.

Capital Gains Tax: Cut To Tax-Free Allowance Continues

Despite hopes for a reversal, the Chancellor has upheld the reduction of the capital gains tax-free allowance. Starting April 2023, the allowance dropped from £12,300 to £6,000, with a further reduction to £3,000 planned for April 2024. This decision has implications for landlords, particularly those planning to sell properties in the coming years.

Stamp Duty Surcharge And Thresholds Remain Unchanged

Speculation surrounded potential changes to stamp duty, but the Chancellor has maintained existing thresholds until March 2025. Property buyers continue to pay no tax on the first £250,000 of their purchase, while landlords and second-home buyers face an additional three percent in stamp duty.

Rental Reforms: No Update Despite King’s Speech Inclusion

Surprisingly, the Autumn Statement did not address the widespread rental reforms included in the Renters’ Reform Bill, despite being a priority in the recent King’s Speech. Key reforms, such as abolishing Section 21 evictions and introducing a Decent Homes Standard, remain uncertain in terms of implementation.

Housebuilding Measures Aim To Ease Rental Property Supply Concerns

Recognising the ongoing demand-supply imbalance in the rental market, the government has allocated over £100 million to build 40,000 homes. Additionally, £32 million will contribute to developing new housing quarters in London, Leeds, and Cambridge, while £450 million is allocated to the local authority housing fund for 2,400 new homes.

For landlords and investors interested in property conversions, the Chancellor announced a new consultation on Permitted Development Rights (PDR). This consultation will explore the possibility of converting any house into two flats without altering its external appearance.

As we reflect on the Autumn Statement, it’s clear that while some areas have seen support and positive changes, there are ongoing uncertainties for landlords. The rental market’s future, alongside evolving regulations, continues to shape the property landscape. Share your thoughts on the Chancellor’s measures for landlords in the comments below.

Stay tuned for more updates and insights on the ever-changing property market.

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