Landlords: +4pp on rental profit confirmed

Rental profits are taxed four points higher than today from 6 April 2027. The Budget added two percentage points to a rise that was already planned, so property income is charged at 24%, 44% and 49% against today’s 20%, 40% and 45%. It applies to individual landlords in England, Wales and Northern Ireland; Scotland sets its own income tax rates. On £10,000 of rental profit that is £400 a year more for a basic-rate landlord and £400 more for a higher-rate one, and the gap widens with the profit — £1,200 a year on £30,000 of profit at the higher rate. The rate applies to rental profit rather than to rent received — that is rent less allowable expenses such as letting agent fees, repairs, insurance and ground rent — so two landlords with identical rent can face very different bills. Savings interest held outside an ISA moves to the same three rates on the same day, which matters for anyone holding a deposit or a float in a savings account. Mortgage interest relief, which has been a 20% tax credit since 2020, was not changed, so for a higher-rate landlord the credit is now worth proportionally less against a 44% charge than it was against 40%.