| answer text |
<p>HMRC estimate that 1 in 5 landlords will pay more tax as a result of this measure.</p><p>
</p><p>Given that only a small proportion of the housing market is affected by this
change, the Government does not expect these changes to have a large impact on rent
levels or house prices. The Office of Budget Responsibility (OBR) also expects the
impact on the housing market will be small.</p><p> </p><p>The Government will double
the housing budget from 2018-19 and has set out the most ambitious affordable housing
plan since the 1970s to support working people in their aim to own their own home,
together the measures in the plan amount to over £20 billion of investment in housing
between 2016-17 and 2020-21.</p><p> </p><p>The level of housing benefits is dependent
on a number of factors such as, household and individual circumstances in regards
to employment and household income, inflation and rents. The Government does not expect
a large impact on rent levels from this policy, and any impact would be dampened in
the short term due to other policy decisions. Therefore, the government does not anticipate
changes to the overall level of housing benefits as a result. Nevertheless, the government
will continue to monitor rental levels charged in the private rented sector.</p><p>
</p><p>Landlords are required to maintain their properties to a legal minimum standard.
The reform to the wear and tear allowance means that all landlords will now be able
to offset the costs of replacing furnishings in their properties removing the previous
disincentive to do so. The Government therefore does not think that the changes to
the tax rules will reduce standards for tenants.</p><p> </p><p>Some landlords may
face difficult decisions regarding their properties. This is why the Government has
chosen to act in a proportionate and gradual way. Basic rate income tax relief will
still be available on a landlord’s finance costs, the restriction will not be introduced
until April 2017 and then it will be phased in over 4 years. This gives landlords
time to plan ahead of the changes.</p>
|
|
