Property Tax for UK landlords.
Section 24 has changed how mortgage interest is taxed. SPV incorporation can help, but the transfer costs need modelling. The 60-day CGT reporting window catches landlords out, and MTD now applies for portfolios above £50,000 gross income.
Section 24 restriction
Mortgage interest is now a basic-rate credit, not a full deduction. The tax bill can exceed the rental margin.
Jump to section 02MTD for ITSA is now live
Gross rental income over £50,000 triggers quarterly digital submissions. The test is gross turnover, not profit.
Jump to section 03SPV incorporation
Moving to a limited company restores interest deductibility, but triggers CGT, SDLT, and refinancing costs that must be modelled.
Jump to section 04The 60-day CGT window
Residential disposals must be reported and paid within 60 days of completion, not at year-end. Miss it and penalties bite.
Jump to sectionWhat has changed for landlords
Section 24 changed the economics of buy-to-let for higher-rate taxpayers. Mortgage interest that was once fully deductible against rental income is now restricted to a basic rate tax credit. For landlords with a lot of borrowing, the tax bill can exceed the rental profit.
At the same time, MTD for Income Tax Self Assessment now applies to landlords with gross rental income over £50,000. Quarterly digital submissions replace annual returns, and the threshold is based on gross turnover, before any expenses are deducted.
Decisions worth getting right
- SPV incorporation: Transferring properties into a Special Purpose Vehicle limited company can restore full interest deductibility, but the upfront costs (Capital Gains Tax, Stamp Duty Land Tax, refinancing) must be modelled against the long-term savings. The incorporation timing guide covers the break-even analysis.
- Capital gains planning: The 60-day reporting window for residential property disposals means you must report and pay Capital Gains Tax (CGT) within 60 days of completion, not at year-end.
- Corporate landlord CT position: Rental profits inside an SPV are subject to Corporation Tax, and each SPV is usually an associated company for the CT threshold tests, worth modelling when building out a portfolio.
- Capital allowances on commercial lets: Furnished holiday lets and commercial property generate capital allowances on qualifying plant and integral features. See the integral features guide.
- MTD position: If your gross rental income exceeds £50,000, you need MTD-compatible digital record keeping in place now.
Related property tax guides
60-Day CGT Reporting for UK Property
When UK residential property disposals need a 60-day Capital Gains Tax report, what to include and how the payment deadline works.
GuideSPV Incorporation for UK Landlords: When the Numbers Work
How landlords use a Special Purpose Vehicle for buy-to-let property, including mortgage interest, SDLT, refinancing and director extraction.
GuideSection 24 Explained for Landlords
How Section 24 restricts mortgage interest relief for landlords, how the tax credit works and why higher-rate taxpayers can pay more.
GuideShould I Use a Limited Company for Buy-to-Let?
When a buy-to-let limited company may make sense, including Section 24, mortgage interest, Corporation Tax, SDLT and director extraction.
Related tools and services
Find out how Section 24 affects you.
We run the numbers on your portfolio with your actual rents, finance costs and personal income tax band. Sometimes the answer is "leave it personal". Moving a portfolio into an SPV is expensive when it is the wrong call.
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