02/11/2026
The tax on rent is going up again.
Last Wednesday, Chancellor John Healey delivered the first Budget of Andy Burnham's government. The headline for landlords: from 6 April 2027, income tax on rental profits rises to 24% at the basic rate, 44% at the higher rate and 49% at the additional rate.
That's 2 percentage points on top of the 2 points announced at last year's Budget. HMRC estimates 2.4 million landlords will face changes in tax by 2031 to 2032, and the OBR says it means "a material reduction in returns to private landlords".
The Prime Minister has also been clear on where rented homes policy is heading. At Labour conference in September he said landlords who rent out the worst-quality homes will be warned to improve them, and if they refuse, councils will find it much easier to acquire them.
What it means if you're building a portfolio:
1. Re-run your numbers at the April 2027 rates, not today's.
2. Buy well. The price you pay and the net yield matter more than ever.
3. Ask your accountant whether a limited company makes sense for you. It depends on your situation.
4. Do the work properly. Good homes, well run, are the right side of where policy is going.
Plan first, property second. You bring the capital, we help you build a roadmap to grow your portfolio.
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General information only, not tax or financial advice. Speak to a qualified accountant about your own situation. The new rates still need to pass in Finance Bill 2026-27. Property values and rents can go down as well as up. Capital at risk.
Sources: GOV.UK Budget 2026 documents and HMRC, NRLA, Property118.