The new coalition government has announced a suite of tax reforms, including reintroducing the ability for property investors to deduct the interest costs on their mortgages against their rental income.
Early criticism of the proposed changes has focused on its retrospective nature (it will be backdated to April 1, 2023), potential windfalls to landlords (at the expense of tenants), and the fiscal cost of the measure.
Missing from much of the coverage was mention of the previous Labour government’s policy being extremely punitive to some landlords, without necessarily bringing the claimed benefit of improving housing affordability. In fact, it is likely to have put upward pressure on rents.
