New report calls for incentives for landlords but does not suggest reversal of unpopular tax change

A new report by the Joseph Rowntree Association has proposed new incentives to encourage landlords to keep their properties up to scratch and to let to poorer tenants.

They are:

  • Introducing a rental incentive allowance allowing landlords to offset a proportion of their rental income against tax if they let to tenants in receipt of Local Housing Allowance.
  • Allowing the cost of certain improvements to properties to be set against income tax.
  • Enabling local authorities to issue vouchers to priority households guaranteeing the payment of rent.

The report – which noticeably stops well short of proposing the abolition of so-called Section 24, which is currently phasing out landlords’ ability to offset finance costs against tax – says its proposals would be cost effective.

It says they would cost the taxpayer respectively £354m a year; £36m for the first year rising to £86m after nine years; and £170m a year.

The total cost would be considerably less than the £808m that the Treasury plans to raise by Section 24.

The report sets out both the current incentives – including feed-in tariffs for rental properties with solar panels – and the disincentives for landlords.

These include welfare cuts which mean that landlords are unwilling to let to tenants who they fear will not pay rent; long delays in evicting tenants; HMO licensing; right to rent checks; and increasing taxation.

An advisory group was used by the report’s authors, Anna Clarke and Michael Oxley, with consultants including ARLA and NALS.


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  1. jeremy1960

    Isn’t the ceo another ex shelter campaigner who’s overpaid , anti-agent and anti – landlords?

    No mention of charity bosses reducing their over inflated salaries and spending money where donors expect it to be spent rather than lining the pockets of the few?

    1. JMK

      Spot on!

  2. JMK

    So… this report is like so many others in that it messes around and fiddles with the edges of the problem but ignores the elephant in the room – S24.  Might as well not have bothered then.

  3. CountryLass

    is Local Housing Allowance the same as Housing Benefit? If they stopped taking an overpayments back from the Landlord, rather than the person who, accidentally or not, received too much then more Landlords may consider them as it is guaranteed rent.

    But if I rent my house out to someone and get their benefits paid directly to me, and that person has claimed too much? Muggins here is the one who has to pay it back, and try and get money from a tenant! And that is why I am wary of people whose entire rent is covered by benefits. Having them as a top up is fine, I receive some tax credits myself but I don’t rely on them to pay my mortgage and bills.

  4. Will

    Having just had a tenant go on benefits the council sent me a form asking for my bank details (just a form no letter or explanation).  My response was I don’t want anything from the council directly to protect myself from the precise scenario CountryLass  refers to.  Needless to say I declined their offer.  I believe this demonstrates the total distrust between Councils and Landlords causes by “Clever (So they think)” councils.  Why would I want their funds? it is not only the claw back provisions but also councils don’t answer the phone, impossible to talk to anyone who is able to resolve issues etc etc – WHY BOTHER?  Its bad enough with everyone else you have to deal with being held on 10th in the queue!!

  5. Woodentop

    Sounds like a scheme for the benefit of housing associations. Absolute joke for the private sector.The only incentive a private landlord needs …. make it a criminal offence for breach of tenancy agreement by tenants.

  6. Deltic2130

    Agree with JMK totally. Reports like this are an utter waste of time. They think their small-scale, irrelevant suggestions are somehow going to turn the tide in the ever diminishing landlord-to-benefits-tenant market?! Insanity. The one big issue right now preventing a landlord renting ANY property – to ANYONE – is taxing a landlord out of existence with S24. Anything else is just unhelpful gravy.

  7. CountryLass

    I really don’t see why the Government keeps trying to stick their noses in. To me, it is very simple.

    The Landlord owns the property and can decide who lives there and if they can have pets, if s/he will accept pets, if they are happy for smokers to live there, and if they are happy for the rent to be paid via housing benefit.

    In return, the property must be safe! Gas safety certificates, electrical reports, CO detectors, smoke alarms etc must be done, and Landlords registered, or at least the property registered and the Agent managing it so that all these things can be tracked. To weed out rogue landlords, every tenancy MUST be started by an Agent, they do not have to manage it, but the tenancy must be set up correctly to stop unsafe properties being lived in. If a Landlord wants to do it themselves, then fine, but they must be registered and held to the same standard as Agents.

    If Landlords must lose out on tax benefits, then the Agents should be able to make the letting/monthly management fee VAT exempt so that they aren’t being stung twice by HMRC. Section 21 and Section 8 should be easier to enforce, I’ve heard rumours about a ‘housing only’ court and that would work.

    From the Tenants side, failing to pay the rent should be a breach of agreement, and treated accordingly. If a Section 8 is served then it should not be able to be dismissed by the tenant paying a fraction of the rent, it should be at least one month with a solid payment plan to clear the rest. Any further default puts it back in force immediately. Deposits should be left as 1.5 months rent, minimum.

    Fair fees should be allowed for Tenants, but this should be regulated via the previously mentioned registration system.

    Any questions? Nope? Thank you, I’ll start as Housing Minister next week, ok?

    1. Woodentop

      Mr Corbyn may object, Mr Cable has turned rogue with lettings common sense and Mrs May … seriously needs the right person to do the job right … so she may be more likely to be the one to apply to for the job. The current housing minister  …. doesn’t get a rating on any review sites.

      1. CountryLass

        In all honesty I wonder how you would apply for the job?


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