Why the 2% Tax Rise Might Be the Breaking Point — or a Turning Point

If you’re a landlord, chances are the last few years have felt like a constant uphill climb. One tax change rolls in, followed by new compliance rules, higher costs, and more uncertainty. Now we’ve got another 2% increase in property income tax on the horizon, and honestly, it’s no surprise our inboxes have been busier than ever.

The message we keep hearing is simple: “Is this still worth it?”

That frustration is completely understandable. Margins are tighter, admin is heavier, and the sense of being squeezed from all sides is real. But before writing this off as the final nail in the coffin, it’s worth taking a step back and looking at the bigger picture.

What we’re seeing isn’t a sudden change of direction — it’s part of a longer-term shift. Over time, property income has been brought more in line with how other income is taxed. Whether or not the government says it outright, the direction of travel seems clear: fewer accidental landlords, more professional ones. Less passive ownership, more structure, planning, and long-term thinking.

That does mean some landlords will decide they’ve had enough — particularly smaller, highly geared portfolios where the numbers just don’t stack up anymore. But it also means the sector itself may change shape. Larger operators, corporate structures, and institutional investors are likely to become more dominant. And individual landlords who adapt — by reviewing ownership structures, using better tax planning, embracing digital reporting, or diversifying — may still find a way forward.

So perhaps the real question isn’t “Can landlords survive another tax rise?”

It’s “What kind of landlord survives — and even thrives — from here?”

As we move towards 2027, this feels like a genuine crossroads moment. For landlords and advisers alike, it’s going to take clear-eyed realism, good advice, and a bit of creativity. The role of the landlord isn’t disappearing — but it is changing. And how people respond now will shape the next chapter of the rental market.

#Landlords #PropertyTax #TaxReform #ResidentialProperty #UKTax #TheTaxFaculty #FinanceInsights #PropertyInvestment

Is It Still Worth It? The Question Landlords Keep Asking Us

Landlords have had a lot to contend with over recent years, and the announcement of a further 2% tax rise from April 2027 has understandably struck a nerve. At The Tax Faculty, we’re hearing the same question again and again: is it still worth it?

Capital Gains Tax Expertise: The Tax Faculty LLP Managing Partner Charles Tateson Named UK Capital Gains Tax Advisor of the Year 2023

The Finance Monthly Taxation Awards recognises the achievements of tax professionals from around the globe.

Winning such an award is no small feat. It is a reflection of hard work, extensive knowledge, and an ability to navigate the intricacies of the UK tax system.

Read more about Charles and the award here.

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