Most brokers want Osborne to scrap ‘unfair’ BTL tax relief cut

Nearly six in 10 mortgage professionals believe Chancellor George Osborne should reverse his proposed cuts to landlord tax relief.

A Mortgage Strategy poll of 192 readers shows 58 per cent believe Osborne should scrap plans to limit the tax relief landlords can claim on property finance costs to the basic rate of income tax.

The Buy to Let Business managing director Ying Tan says: “I think George Osborne should reverse it but I don’t think he will, so we should embrace it. 

“We will evolve. The people who it is really hard on are the people who have spent years accumulating wealth and I am not sure that is fair.

“It is not a very liquid asset so it is not like you can sell everything before 2017 – it is pretty harsh. The other thing is they did not engage the market as much as they should have before taking the decision.”

Tan says those who believe the Chancellor should continue with the reform are underestimating the impact it will have on the sector.

He adds: “I don’t think some people understand the full impact [of this reform]. And some brokers may well perceive that any damage done to the buy-to-let market will benefit the residential market. 

“So it does not surprise me that there are so many people who think it is not a bad thing.”

Landlords have already voiced their concerns and have started a petition to persuade the Chancellor to reverse the changes. To date, it has gathered more than 26,600 signatures, although it needs 100,000 before it can be considered for debate in parliament.

Landlords say they have been unfairly targeted. The petition adds: “We operate as sole traders and incur costs in the course of running our business. The planned restriction will unfairly target us by preventing us from offsetting costs in the same manner as other sole traders. 

“We ask that the planned restriction be reconsidered as it has unfair implications.”

However, the Government says just 18 per cent of individual landlords are expected to pay more as a result of the changes.