Fact sheet: 'Replacement of Domestic Items’ relief for landlords

Self-employed businesses in the UK with income over £50,000 will need to follow new rules for recording and submitting tax information under Making Tax Digital for Income Tax Self-Assessment (MTD for ITSA). Businesses and landlords affected by the change will be required to maintain digital records, use HMRC-approved software, and submit tax information quarterly, rather than through a single annual Self-Assessment return.

The Scottish Government has launched a consultation on proposals to align reliefs on Land and Buildings Transaction Tax (LBTT) for investor schemes with those available in England and Northern Ireland, making Scotland more attractive to large-scale investors. Propertymark supports this move but urges Ministers to give equal priority to incentives for individual landlords to ensure a diverse and sustainable property sector.

A study commissioned by HM Revenue & Customs (HMRC) confirms what Propertymark has long highlighted — UK Government tax policies are pushing landlords to sell, and the private rented sector (PRS) is feeling the strain. The research, conducted by Ipsos, offers a valuable snapshot of today’s landlords, drawing on responses from over 1,200 participants and in-depth interviews. Most alarmingly, nearly a quarter of landlords intend to reduce their property holdings in the next 12 months, with that figure rising to a third when looking at the next five years.

Plans are afoot to strengthen HMRC (HM Revenue and Customs) to act quickly and robustly against professional tax advisers who help clients avoid paying the correct tax. Propertymark welcomes this because it aligns with our calls to the Treasury, and we support HMRC’s ambition to ensure the financial sector upholds the highest standards and integrity of the tax system.