The Impact of the Autumn Statement on the Property Sector

The first Autumn Statement from the new Chancellor, Jeremy Hunt, has brought mixed commentary from the media regarding the impact of tax changes for property investors and landlords.

The key announcements are:

• The recent reduction in the Stamp duty threshold announced in September - a support to the property sector - will now be removed at the end of March 2025.
• No PRS rent freeze was announced.
• Higher-rate taxpayers will start paying the top rate of 45p at ￡125,140, down from ￡150,000, meaning anyone earning ￡150,000 will pay an additional ￡1,200 tax.
• Personal income tax thresholds will remain unchanged until 2028.
• The reduction in the CGT annual exemption from ￡12,300 to ￡6,000 in 2023 and to ￡3,000 in 2024 will hit landlords when they sell a property.
• For landlords running a limited company, the dividend allowance will be cut from ￡2,000 to ￡1,000 in 2023 and to just ￡500 the year after.
• IHT remains the same.

Even though these are challenging times for the UK economy, we see pockets of opportunity for landlords as rents remain high due to a lack of supply, as property prices weaken. For example, there is an increased demand for university accommodation from overseas students studying in the UK.

For a more detailed look at our latest thoughts on Rishi Sunak's appointment and the outlook for the rental sector, take a look at this post on the?outlook for buy-to-let landlords.