The National Landlords Association (NLA) is to donate £10k to support the Judicial Review of clause 24 against the Government’s controversial decision to remove Finance Costs for individual landlords.
The Chancellor’s move to remove of Finance Costs which he announced in last July’s Summer Budget will be introduced from April 2017 as part of the Finance Act, and will restrict the rate of mortgage relief to the basic rate of income tax (20%) for all landlords regardless of their personal tax bracket.
The measure, which means that mortgage interest tax relief can no longer be classed as a business expense, but purely as a tax credit, has been widely criticised, even among several Tory MPs.
The crowd funded Judicial Review was launched by landlords Chris Cooper and Steve Bolton, and according to the NLA two hard-working property business owners who invested in property as a prudent way of securing a modest pension (Chris) and to provide an alternative income (Steve).
The announcement was made by NLA CEO Richard Lambert at the Tenant Tax Summit, taking place today at the ILEC in Earls Court, London, which includes a host of speakers from the property world who are against the measure. These include Lord Howard Flight, Kriss Akabusi, and Richard Dyson, Personal Finance Editor at the Daily Telegraph.
Addressing the conference, Mr Lambert said:
“We have yet to see an argument which would convince us to change our mind about the Judicial Review’s chances of success, but we have to recognise that there is always the possibility that we may be wrong.
“For all the humble pie I would have to eat, I for one would be quite happy to be proved wrong on this one, so as a goodwill gesture to the campaign in recognition of our shared aim of fighting for landlords, the NLA will donate £10k to the campaign fund.
“The NLA is committed to continued lobbying to achieve a political solution to the problem presented by this disastrous government policy and we are hopeful of a positive outcome for the hundreds of thousands of landlords whose businesses are currently in jeopardy”.
Further support on the issue has been given by the Residential Landlord Association’s (RLA) relentless campaigning to challenge the proposed restrictions and according to the RLA it’s starting to make an impact in Westminster, with what they claim is a surge of support from Tory backbenchers.
“A number of Conservative MPs are now openly challenging the Government on the changes, which will see mortgage interest tax relief restricted to a basic rate, even for higher rate-paying landlords.” Says the RLA.
The RLA met Treasury Minister Lord O’Neill on the 3rd May. Directors have also met with a number of influential Conservative backbenchers including Graham Brady, chair of the 1922 committee and former Secretary of State for Wales David Jones MP.
Since then a political head of steam has been building, says the RLA with MPs becoming increasingly vocal about their concerns.
David Jones MP produced an article for Conservative Home expressing his concerns about the changes following a meeting with the RLA, with Graham Brady quoted in the Daily Telegraph expressing ‘serious concerns’ about the plans.
Mark Field MP wrote an article for City AM in which he warned that the changes would hit domestic buyers hard and could result in rent hikes, with landlords passing costs on to tenants.
In addition Conservative peer Lord Flight has publicly backed the RLA campaign, writing an article for the Daily Telegraph in which he claimed attacking buy-to-let would worsen the UK’s housing crisis.
RLA policy director David Smith is addressing the Tenants’ Tax Summit campaign rally. However, after seeking its own legal advice the RLA says it has concluded there would be little chance of success if it pursued a costly judicial review.
The association is now asking its members to keep up the pressure on the Government, especially on Conservative MPs, with more than 400 having already written to their MP about the changes.
NLA supports judicial review on tax changes https://t.co/RRHcELGQou
— LandlordZONE (@LandlordZONE) June 30, 2016