February 2021 Rental Update 24 Feb 2021
As I type this Boris has made his “Road Map” announcement to get us out of lockdown and I am dreaming of getting away this summer and having a haircut sometime this year too – we’ll see! There is much to update you with so my apologies as this is rather long and there is lots to read!
The good news is that the demand for rental property continues to be huge and we are desperately short of rental property and have an ever-growing list of great applicants looking to rent. Do you have any family or friends with rental properties? We would love to hear from potential landlords. Get in touch here.
Remember we also offer empty property minding if you have, or know somebody, with a vacant property please ask them to get in touch.
Making Tax Digital (MTD)
From 6th April 2023 anyone making more than £10,000 a year (income not profit) from property will need to send HMRC quarterly updates of income and expenses via software which aligns with the HMRC digital tax account.
Essentially it allows your tax to be calculated “as you go”. At the end of the year, instead of sending in a self-assessment tax form, or getting your accountant to send in a limited company tax return, you sign a declaration that your quarterly returns are accurate. You’ll then have until January 31st the following year to pay your tax, as usual.
VAT-registered businesses with a turnover of more than £85,000 a year should already use MTD Meanwhile, in 2022, MTD is due to be rolled out to companies with a turnover of less than £85,000 for VAT. Landlords earning less than £10,000 a year from property won’t need to set up a digital tax account, and neither will landlords who take lodgers in their home under the Rent A Room scheme.
The Renters Reform Bill
The Renters Reform Bill was announced in the Queen’s Speech in December 2019.
Due to the Covid-19 pandemic, there is no date as yet for the bill to be presented to parliament. The Housing Minister, Christopher Pincher MP, outlined that the Bill will be brought forward when ‘there is a sensible and stable economic and social terrain’ following the emergency coronavirus response. However, last in a January debate in the House of Commons, junior Housing Minister, Kelly Tolhurst said “The government are committed to enhancing renters’ security by abolishing no-fault evictions. During the Covid-19 pandemic, our collective efforts have been focused on protecting people during the outbreak. This has included introducing longer notice periods and preventing evictions at the height of the pandemic on public health grounds. We will introduce a renters’ reform Bill very soon.”
What is The Renters Reform Bill?
The Bill proposes to:
- Abolish Section 21 repossession and reform the grounds for possession.
- Improve the court process for landlords to make it quicker and easier for them to get their property back.
- Introduce a new lifetime deposit so that tenants don’t need to save for a new deposit every time they move house.
- Develop and implement measures to widen access to and expand the scope of the database of rogue landlords and property agents.
- Give greater powers to drive improvements in standards, and empower tenants to make an informed choice about who they rent from.
Organisations representing landlords are lobbying parliament on the Bill and Arla Propertymark, for example, responded to the consultation explaining that in order to mitigate any negative impact of these proposals the government must:
- Introduce a Housing Court: To ensure that the proposals are workable the Government must consider introducing a Housing Court or adequately resource and amend the existing Courts system.
- Use a technological solution: possession claims must be digitised and taken online.
- Create mandatory grounds: all grounds for possession both existing and new should be made mandatory in order to effectively compensate for the removal of Section 21.
- Ensure automatic High Court Enforcement: landlords must be given an automatic right to have their Possession Order executed by a High Court Enforcement Officer.
- Implement a pilot scheme: before a national rollout of the proposals, a pilot scheme must be administered to evaluate the effectiveness of the new system.
We will update you when we have further news, in the meantime if you have any questions, please contact me here: lettings@willsandsmerdon.co.uk.
Wealth Management for Landlords
I’m delighted to introduce Thomas Rigg, who provides a comprehensive wealth management service, offering specialist face-to-face advice tailored to you.
Thomas is a Chartered Financial Planner, who has undertaken rigorous criteria relating to professional qualifications & good ethical practice, hence our connection with him. This means that you can be confident that you are dealing with one of the UK’s leading advisers that is wholly and committed to provide you with the best possible support advice, service and support. The cornerstone of Thomas’s approach, is to ensure that he has a strong understanding of where his clients are currently and where they want to be in the future. Following this, he will then provide a bespoke financial planning solution which is tailored to your requirements. Initial meetings are without cost or obligation.
Thomas’s comprehensive service includes:
- Financial Protection
- Savings & Investments Planning
- Retirement Planning
- Inheritance Tax Planning
- Corporate Planning for Companies
- Mortgage Planning – Residential and Buy to Let
Thomas can be contacted on
t. 01483 202026 / 07824 664254
