From April 2017, the amount of income tax relief landlords can claim on residential property finance costs will be reduced. The income tax relief on mortgage interest will be restricted to 20%. This change will be introduced gradually over a 4 year period.
Wear and Tear Allowance
The Wear and Tear Allowance has been a valuable tax relief for those landlords that let fully furnished properties. From April 2016, this will be replaced by a new relief that allows landlords to deduct the actual costs of replacing furnishings.
The level of rent-a-room relief will be increased from £4,250 to £7,500 per annum.