Landlords warn 4% tax rise on rental income will push up rents

BBC Two's Politics Live reported that the Budget will add 4% to tax on rental income from April 2027. The programme said landlords face the rise in the new tax year.

Maureen Treadwell, a landlord with five rental properties, said the measure was presented as a tax on landlords but the real risk was to tenants. Higher costs would be passed on as rent increases, she said, and landlords who could not pass them on might sell. She said that would push more families into temporary accommodation and affect labour mobility.

She said the tax came on top of regulation, licensing costs and fines that had made letting unviable for many landlords. Most landlords were not rich, she said, and two-thirds were basic rate taxpayers. She also said many landlords charged below market rents to good tenants.

A Labour MP on the programme defended the rise, saying the government had rebalanced the relationship between landlords and tenants. Tenants could challenge unfair rent increases and no-fault evictions had been abolished, the MP said. The MP said the Budget had to find money in difficult circumstances, with war in Iran pushing up fuel and energy costs, and cited NHS waiting lists and £100 off energy bills for bands A to D.

Rachel Millward of the Green Party said the tax rise would only make sense if accompanied by rent controls. Otherwise the cost would be passed to tenants, she said. She called for more social housing, rent controls and higher taxes on extreme wealth, and argued the Budget was not ambitious enough.

Sir Keith, a panellist, said the Renters' Rights Act had been 'massively detrimental' to landlords. He said smaller landlords were disproportionately affected and that landlords were leaving the market. He warned that rent controls would lower supply and push rents up.