Residential property landlords urged to learn about tax changes

Two Lancashire businesses joined forces to explain how the imminent tax changes could impact on the rental profits of residential property landlords and those purchasing second homes.

Over 100 residential property landlords gathered at Moorhouse’s Brewery in Burnley to hear presentations from Cassons business advisers LLP and Petty Estate Agents.

Tax adviser Sinead Duffy used an illustrative example to demonstrate how the changes to allowable expenses and finance costs could affect their profits – both in the next tax year and once the restrictions to mortgage interest are phased in.

Simon Westwell, lettings director at Petty’s, spoke about matching property portfolios to target markets and identifying investment strategies to help maximise return, as well as the future of the residential sales and lettings markets.

“This has seen us let out between 30-35 properties per month to quality and fully referenced tenants. Average tenancies are 18 to 24 months, compared to just 12 months in 2010, and we’re seeing yields up to 10 per cent in parts of Burnley and Pendle.”

“It will be interesting to see if any concessions are introduced when this new legislation is finalised in the Budget on March 16 but as things stand it’s going to have major repercussions for residential property landlords and those looking to purchase second homes.