This measure will restrict relief for finance costs on residential properties to the basic rate of income tax and will be introduced over four years from 6 April 2017.
The measure will not affect companies renting out property.
The measure will not affect individuals renting out commercial property or furnished holiday letting.
The measure will affect residential property in the UK and elsewhere.
The measure will affect mortgage interest, interest on loans to buy furnishings and fees incurred taking out or repaying mortgages or loans.
Landlords will no longer be able to deduct all of their finance costs from their property income to arrive at their property profits. They will instead receive a basic rate reduction from their income tax liability for their finance costs.
Worked examples of the measure can be downloaded from the 'Related documents' section on this page.
