Labour's NI taxation plan for landlords to cost £722 per property

Chancellor Rachel Reeves’ plans to charge National Insurance (NI) on landlords’ rental income will cost £722 a year per property, it has been claimed.

The plans, which were ‘leaked’ last month by HM Treasury in a bid to gauge public opinion, would see NI charged at 8% on landlords who are self-employed.

Inventory Base says its calculations are based on 8% NI tax on average gross annual rental income of £10,621, minus the average property maintenance cost of £1,593 per year.

But London landlords would pay the highest at £885 per property a year. It is the same calculation but for based on the capital’s higher post-costs rental income of £11,060, while in the East of England, landlords are looking at an average tax bill of £802 a year.

Expenses

In the South East, where rental income after maintenance expenses averages £9,900 per property, the average cost of the proposed tax stands at £792, followed by the South West (£750), North East (£684), East Midlands (£680), West Midlands (£677), North West (£646), Wales (£608), and Yorkshire & Humber (£606).

“Landlords are already trying to guesstimate and juggle any potential financial fallout of the Renters’ Rights Bill, so slapping an NI charge on rental income feels less like policy and more like punishment,” says Sián Hemming-Metcalfe (pictured), Operations Director at Inventory Base.

“The private rental sector thrives on stability - tenants need secure homes, landlords need predictable returns. Add another layer of tax and all you create is uncertainty, and uncertainty drives good landlords out of the market.”