Thinking about becoming a landlord this year?
Before you invest, it’s important to understand the latest tax rules,

property regulations, and financial implications that could affect your returns.

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Owning a rental property can still be a rewarding long-term investment, but it’s not as simple as collecting rent every month.

With new tax rates, evolving legislation, and higher borrowing costs, it’s essential to plan ahead and fully understand your obligations as a landlord.

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• From October 2024, anyone buying an additional residential property in England or Northern Ireland must pay an extra 5% Stamp Duty Land Tax (SDLT) on top of standard rates.

• On a £300,000 property, this means paying £15,000 more in tax than a standard homebuyer.

• In Scotland, under the Land and Buildings Transaction Tax (LBTT), the additional dwelling supplement currently stands at 6%.

• In Wales, the Land Transaction Tax (LTT) surcharge for additional properties remains 4%.

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Since Section 24 came into full effect, private landlords cannot fully offset mortgage interest payments against rental income.

Instead, you receive a basic rate (20%) tax credit, and income tax is calculated on your gross rental income, not your profit after interest.

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If you own your property through a limited company, the rules differ, mortgage interest can still be deducted as a business expense before corporation tax is applied.

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When you sell a buy-to-let property, any profit is subject to Capital Gains Tax.

• 18% for basic-rate taxpayers

• 24% for higher- and additional-rate taxpayers (reduced from 28% in 2024)

The tax-free allowance for CGT has been reduced to £3,000 for the 2025/26 tax year (down from £6,000).
This means landlords will now pay more CGT when selling investment properties than in previous years.

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Many investors now purchase rental properties through limited companies to benefit from:

• Paying 25% corporation tax (for profits up to £250,000) instead of higher personal income tax rates

• The ability to offset mortgage interest as a business expense

• Greater flexibility for inheritance and succession planning

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However, there are downsides to consider:

• Fewer mortgage products available for company-owned buy-to-lets

• Potentially higher arrangement fees and interest rates

• The requirement to file annual accounts, often via an accountant

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England, Wales & Northern Ireland

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Basic | £12,570 – £50,270 - 20%

Higher | £50,271 – £125,140 - 40%

Additional | Over £125,140 - 45%

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If you’re planning to pass your property portfolio to family members, buying through a limited company may offer potential inheritance tax advantages — depending on your structure and estate.

Professional tax planning advice is essential before proceeding with this approach.

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Landlords are responsible for more than just collecting rent. You’ll need to:

• Research and purchase suitable property

• Manage refurbishment or furnishing

• Find tenants and oversee maintenance

• Keep up with all legal safety and energy requirements

If you prefer a more passive approach, using a professional letting agent can significantly reduce your time commitment and risk.

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A qualified letting agent can:

• Market your property and screen tenants

• Manage rent collection and deposit protection

• Arrange annual gas, five-year electrical safety checks and 10-year EPC conduction.

• Ensure your property meets at least an E-rated EPC

• Manage maintenance issues and legal compliance

Working with an agent ensures peace of mind, protects your investment, and helps you stay compliant with ever-changing regulations.

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Buy-to-let remains a strong option for long-term investors who understand the market and plan carefully.
While rising costs and taxes have made it less lucrative for some, property can still deliver consistent rental income and capital growth over time, especially when professionally managed and strategically financed.

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Find Out What Your Property Could Earn

Curious about how much rent your property could achieve?

Arrange a free consultation with one of our lettings experts to discuss your property, yield potential, and next steps.