The United Kingdom is restructuring their taxation for landlords which will increase costs for them and in turn make mortgage financing more important and a crucial aspect of making deals. The taxation will be reflective of the size of the mortgage and the mortgage interest that is calculated. So it will be important for landlords to negotiate low rate mortgages for their clients. By taking advantage of the current low rates some landlords may not be ass effected by the new taxation that goes into effect in 2020.
Key Takeaways:
- In April the way taxes are applied on buy-to-let and rental properties. The changes will occur over four years but ultimately will lead to higher taxes and smaller profits. Some investors will be incl
- Mortgage rates are low right now but if they increase in the future it will be a double financial hit with the increased mortgage and the higher taxes.
- Land owners need to find the lowest mortgage possible and try to lock in their rates. Landlords must keep a close eye on all expenses.
“Investors will no longer be able to deduct mortgage interest costs from rental income when calculating the taxable profit.”