The Autumn Budget, which will be announced on October 30th, could benefit landlords in a variety of ways. They are likely to be affected by the following key measures:
1. Tax Relief for Self-Employed Landlords: Self-employed landlords stand to benefit from the proposed National Insurance cuts. Eliminating Class 2 National Insurance and reducing Class 4 from 9% to 8% could save landlords up to £250 per year, particularly for those managing multiple properties.
2. Local Housing Allowance (LHA) Increase: The government intends to raise LHA rates, which help tenants cover rental costs. This increase, expected to cover 30% of market rents, may indirectly benefit landlords by allowing tenants to afford higher rents and potentially reduce arrears.
3. Permitted Development Changes: The budget may also include measures to make it easier to convert homes into flats. A new Permitted Development Right could enable landlords to split properties into two flats without changing the facade, potentially increasing rental income and property value.
However, landlords should be aware of potential Capital Gains Tax (CGT) increases. CGT rates may increase significantly, leading some landlords to consider selling properties ahead of the changes. If implemented, these measures will provide both immediate financial benefits and long-term growth opportunities for property investments.
