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UK Budget Lifts Rental Income Tax by Two Points in £26bn Revenue Plan

Landlords warn of higher rents ahead of renters’ rights reforms taking effect next spring.

Overview

  • The increase raises property tax rates to 22%, 42% and 47% in England, Wales and Northern Ireland, with changes scheduled by April 2027.
  • Budget estimates indicate the measure will raise about £500 million a year on average from 2028–29.
  • Letting agents and landlords say tenants will face higher rents, and some smaller owners are likely to sell properties.
  • Industry commentators predict more homes could shift to large corporate landlords as the Renters’ Rights Bill ends Section 21 no-fault evictions in May.
  • Financial services groups welcomed the Budget’s decision not to add new levies or regulatory burdens on banks.