Autumn Budget 2024: 7 Key Takeaways For Landlords

The Autumn Budget 2024 has introduced significant changes and updates that directly impact landlords and the broader housing market. 

While it's not all bad news for landlords with new initiatives to increase housing supply and support the build-to-rent sector, alterations in Stamp Duty Land Tax will dramatically increase tax liabilities on new property purchases and the introduction of MTD for IT in 2026 will change how many landlords report their taxes.

Ultimately, these measures reflect the government's determination to address the housing crisis while modernising the tax system and may require investors to reassess their long-term wealth strategies.

In this article, we will explore key takeaways from the budget that landlords need to be aware of to navigate the evolving landscape of property management and investment. 

2% Increase On Stamp Duty Land Tax For Second Homes

The government has raised the Higher Rate for Additional Dwellings (SDLT) for landlords in England, increasing it from 3% to 5%, effective 31 October 2024. 

This increase applies to purchases of second homes, buy-to-let properties, and residential property acquisitions by companies. Contracts exchanged unconditionally before 31 October 2024 are exempt from the new rates if no subsequent changes are made.

With this change, landlords will incur SDLT rates of:

• 5% on properties valued up to £250,000,
• 10% on the portion from £250,000 to £925,000,
• 15% between £925,000 and £1.5 million,
• and 17% on any amount above £1.5 million.

These thresholds remain in effect until 31 March 2025, after which new rates will apply as follows:

• Up to £125,000 – 5%
• £125,000 to £250,000 – 7%
• £250,000 to £925,000 – 10%
• £925,000 to £1.5 million – 15%
• Above £1.5 million – 17%

Learn more about SDLT and use our free buy-to-let SDLT calculator here →

No Capital Gains Tax (CGT) Increase For Residential Property

The anticipated hike in Capital Gains Tax (CGT) on residential property sales did not occur. 

Instead, the Chancellor has aligned the main CGT rates with those currently applied to residential property, raising the basic CGT rate from 10% to 18% and the higher rate from 20% to 24%. 

Effective 30 October 2024, the new CGT rates are as follows:

• Basic rate: from 10% to 18%
• Higher rate: from 20% to 24%

From April 2025, the CGT on Carried Interest will increase from 28% to 32%. Business Asset Disposal Relief (BADR) and Investor’s Relief will continue, with the following rate changes:

• From 6 April 2025, the rate will increase from 10% to 14%
• From 6 April 2026, it will further increase from 14% to 18%

Committing To Making Tax Digital

As part of the government’s initiative to modernise the UK’s tax system, Making Tax Digital (MTD) was first introduced in 2015. While MTD has been fully implemented for VAT, its rollout for income tax purposes (MTD for ITSA) has faced several delays. It is now scheduled to be introduced for sole traders and landlords with income exceeding £50,000 starting in April 2026, followed by those with income over £30,000 in April 2027.

The Budget has reaffirmed the government’s commitment to implementing MTD for ITSA with new investment in related services, staff, and technology. They also announced plans to expand the rollout to include those with income over £20,000 by the end of the Parliament. The specific timeline for this rollout will be announced in a future Budget.

Read the complete guide to MTD for landlords here →

If you want to get ahead of MTD, create your free Landlord Studio account today. Keep up to date digital records and make the transition easy.

Corporation Tax Capped

For landlords operating under a Limited Company structure, the Corporation Tax rate has been capped at 25% for the remainder of the Parliament. Currently, companies with profits up to £50,000 pay a 19% rate, while those with profits of £250,000 or more pay 25%. A marginal relief system applies to profits between these thresholds.

According to the Government, this structure ensures that 90% of actively trading companies will have a Corporation Tax rate below 25%.

Additional Support for the Broader Housing Market

In line with the Government's commitment to build 1.5 million new homes during this Parliament, the Chancellor announced several key initiatives:

• Affordable Homes Programme: An additional £500 million will be allocated in 2025-26, raising the annual budget to £3.1 billion, with further investment anticipated in the Spring fiscal update.
• Mortgage Guarantee Scheme: Plans are underway to make this scheme, supporting 95% loan-to-value mortgages, a permanent fixture, with consultations with industry partners over the coming months.
• Social Housing Rent Settlement: A proposed five-year settlement will cap social housing rent increases at inflation +1%, aimed at providing stability.
• Right to Buy Adjustments: Reductions in Right to Buy discounts, along with measures allowing councils in England to retain all sales receipts, aim to preserve council housing stocks.
• Planning Support: Funding will be provided to recruit and train 300 new graduates and apprentices for local planning authorities, accelerate stalled large development sites, and enhance local planning capacity to support the Government's broader reform agenda.

Additional Support for Build-to-Rent

To help increase housing supply, the Chancellor has announced an additional £3 billion in support for SME housebuilders and the Build-to-Rent sector. This support will be provided through housing guarantee schemes, enabling developers to access more affordable financing.

Inheritance Tax Update

The current nil-rate band (£325,000), residence nil-rate band (£175,000), and the residence nil-rate band taper threshold (£2 million) will be frozen until at least 5 April 2030.

Starting in April 2027, pensions will become subject to Inheritance Tax (IHT), with additional details to be released soon.

Changes to Business Property Relief (BPR) and Agricultural Property Relief (APR) will take effect from 6 April 2026. While up to 100% relief is currently available on qualifying business and agricultural assets, the revised approach will provide:

• 100% relief on the first £1 million of combined agricultural and business property to support family farms and businesses
• 50% relief on values above £1 million

Additionally, the relief rate on unlisted shares (such as those on AIM) will be reduced to 50% in all cases.

Other Tax Updates In The Autumn Budget 2024

The Autumn Budget 2024 covered a broad arrangement of sweeping tax reforms. A few other tax-related measures announced in the budget include:

• Starting 1 April 2025, film and high-end TV productions will be eligible for increased tax relief on UK visual effects expenses.
• The Energy Profits Levy will see an increase.
• The 40% business rates relief for retail, hospitality, and leisure sectors will continue into 2025/26, capped at £110,000 per business.
• Air Passenger Duty on private jets will increase.
• Tobacco Duty will rise in line with inflation.
• The Enterprise Investment Scheme (EIS) has been extended, remaining in place until at least 2035.
• A 1.7% decrease in duty on draught alcohol.

Final Words: Autumn Budget 2024

The Autumn Budget 2024 presents a mixed bag of opportunities and challenges for landlords. While the increase in Stamp Duty Land Tax and adjustments to Capital Gains Tax may raise concerns, the government’s commitment to boosting housing supply and supporting the Build-to-Rent sector offers some a silver lining. 

The planned implementation of Making Tax Digital and the cap on Corporation Tax are steps towards a more streamlined tax process, which could benefit landlords in the long run. As the housing market continues to evolve, it’s essential for landlords to stay informed about these changes and adapt their strategies accordingly. 

By leveraging the support available and understanding the new tax landscape, landlords can better position themselves to thrive in this dynamic environment.

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