Plan Insurance Blog

A Summary of the Key Budget Features For Landlords

Chancellor Rishi Sunak unveiled the contents of his Budget to parliament on October 27th. It was eagerly awaited with big choices to be made. What funds would the government allocate in the next three years to – health, policing, education and numerous other public services requesting additional support? And just as crucially would additional taxation be introduced to cover the costs?

The Chancellor’s budget and accompanying spending review outlines how much the government will take in taxes, and what they will spend it on. This year’s Autumn Budget is unusual as it’s the second of the year. The Budget in March prepared businesses for substantial rises in corporation tax in the coming years.

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However, this Autumn’s Budget painted a brighter picture than many experts expected. The UK economy is emerging in a better position from the pandemic than most predicted. The stated focus would be to establish in the “post-Covid” era an economy built on “higher wages, higher skills, and rising productivity”.

Your landlords business obviously can’t be viewed in isolation and the context of how the country is performing as a whole will have a significant impact.

Wider Economic Outlook


In the last financial year up to the end of April 2021, the government borrowed £320bn. That is the highest figure outside wartime. Expensive support mechanisms such as the Furlough scheme had to be funded. Economists expect a further £180bn more to be borrowed this year as government income remains down on pre-pandemic levels.

  • Net borrowing as a percentage of GDP is forecast to fall from 7.9% this year to 3.3% next year
  • Net borrowing as a percentage of GDP will then fall in the following four years to 1.5%

Job Numbers…

Employment as pointed out by the Chancellor “Is up. Investment is growing. Public services are improving. The public finances are stabilising. And wages are rising.”

  • Unemployment is expected to peak at 5.2% in 2022, lower than 11.9% previously predicted
  • Wages have risen in real terms by 3.4% since February 2020


Economic growth is higher than previously predicted. Though it will slow dramatically in the near future closer to pre-pandemic levels.

  • Annual growth is set to rebound by 6.5% this year, followed by 6.3% in 2022 and 1.3% by 2023
  • UK economy is forecasted to reach pre-Covid size by 2022


Amongst all the good news inflation remains a major concern for many businesses and their paying customers. In September it was 3.1% and is likely to rise to average 4% over next year. That’s double the Bank of England’s targets. Price rises could hit their highest level in 30 years.

Housing, Property Construction & Cladding Announcements

  • £24 billion has been earmarked for housing. This includes £11.5 billion for up to 180,000 of affordable homes.
  • £1.8 billion for brownfield sites are specifically being targeted for development
  • £640 million a year has been allocated to addressing rough sleeping and homelessness
  • Many high-rise flat owners have been hit with crippling expenses as a result of the cladding crisis that followed the Grenfell Tower tragedy. The chancellor confirmed plans for a levy on the biggest developers of high rise properties to pay for the removal of dangerous cladding.
  • 4% levy will be placed on property developers with profits over £25m to help create a £5bn fund to remove unsafe cladding
  • The spending review reiterated £3.9 billion of support from the heat and buildings strategy for home insulation and low-carbon heating.

Green Funding for Landlords

From April 2022 as part of the government’s Heat and Buildings Strategy, originally announced in early October, landlords will have access to grants of £5,000 to replace gas boilers with heat pumps. The sale of gas boilers will not be permitted after 2035. Air source heat pumps can cost between £6,000 and £18,000. Though work is being carried out to help reduce these costs. There was speculation that a revised version of the Green Homes Grant would feature in the Budget but no new initiative was launched. The Green Homes Grant from 2020 was intended to improve the energy efficiency of UK homes. Vouchers were offered to help landlords and homeowners pay for green renovations. Yet it was abandoned early in the year after many difficulties, such as delayed application processes and shortfalls in covering renovation costs.

Tax, Business Rates & National Insurance For Landlords

After being hit with numerous new tax rises this budget was fairly pain free for landlords. No tax rises were announced for landlords. There were even some positive changes for landlords:

  • Despite much speculation the Budget would increase capital gains tax this failed to materialise. In fact from October 27th 2021, landlords will have more time to pay capital gains tax (CPT) after a property sale. The property payment window for residential sales will increase from 30 to 60 days. This will make it easier to file and pay any CPT on a residential property.
  • Tenants who work and receive Universal Credit will also benefit. The taper rate for payments is to be cut on December 1st 2021from 63% to 55%.
  • With 950,000 low-income households in rent arrears the Government has also made an additional £65 million available to local authorities to prevent homelessness in a Covid-19 debt fund. Therefore, landlords of occupants facing financial difficulty should encourage contact to be made with their local authority to see if support is available. However Chris Norris, Policy Director at the National Residential Landlords Association, suggested that the fund required to tackle Covid related rent arrears actually needs to be around £300 million.
  • As announced prior to the Budget, landlords with an income over £10,000 a year will have an extra year to prepare for Making Tax Digital. The new rules for income tax self-assessment will now be introduced on April 6th 2024.
  • A 50% business rates discount for the retail, hospitality, and leisure sectors in England in 2022-23, up to a maximum of £110,000, may help some commercial landlords keep premises tenanted. A consultation on an online sales tax may also point to good news for landlords looking to rent high street properties.
  • On a more general note, in September the government announced employees, employers and the self-employed would all pay 1.25p more in the pound for National Insurance (NI) from April 2022 to fund social care.
  • And in the last Budget, Mr Sunak revealed thresholds as which income tax is paid would be frozen at April 2021 levels for five years. That means pay rises will push more people into higher tax bands.

So all in all a fairly busy budget but pain free in the main for the landlord sector.

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