Section 24 Explained: Tax Relief Changes for Landlords
What every buy-to-let landlord needs to know about mortgage interest tax relief restrictions.
What changed under Section 24
Section 24 removed full mortgage interest deductibility for individual landlords and replaced it with a 20% tax credit.
Instead of paying tax on profit after full finance costs, many landlords now pay tax on a higher taxable figure and then claim a limited credit.
Why impact can be larger than expected
Higher taxable income can push landlords into higher tax bands and affect allowances, child benefit charge exposure, and student loan repayments.
Cashflow can tighten even when property performance looks stable on paper because tax timing and tax base both shift.
How landlords respond
Options include portfolio reviews, debt strategy changes, ownership structure planning, and reviewing whether limited company ownership is viable for future purchases.
Section 24 planning should be numbers-led and property-specific, not based on broad rules of thumb.
Put This Into Action
Track each property's after-tax performance in FIQ Personal and model how Section 24 affects total portfolio returns.
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