This article is your complete guide through the new laws and changes introduced for the landlords in 2022. There are new guidelines released by the government to handle all the landlords’ problems in the last eighteen months. It is a complicated time to be a landlord, but this guide will help you wrap your head around all the changing rules this year.
The tax situation in 2022
Taxes have always been the big and scary news for the landlords every year. But some tax reliefs are expected in the year 2022.
Personal Tax Allowance:
The personal tax allowance rate is £12,570 for 2021-2022. The next £37,700 that you earn is the basic rate limit. You enter a higher-rate tax range if you earn more than the threshold, i.e., £50,270. An increase in the allowance and threshold is observed each year. However, in the year 2022, the tax rate is predicted to be static until 2026. It is a piece of big news because it will help you repay some of the pandemic costs and help you through rough times.
Capital Gains Tax:
Similarly, the capital gains tax is likely to remain static until 2026. The static amount is £12,300. The great news in this area is that you will get extra time to pay capital gains tax if you sell your rental property. Previously you had the time of thirty days to report and pay your CGT. Now, according to the new rules and time relaxation, the span has been increased to sixty days.
Renters Reform White Paper
One of the most prominent changes in the recent legislation for landlords in 2022 is the renters’ reform bill. This new bill abolishes section 21, related to “no-fault” eviction. It is designed to reduce the upfront cost of renting by creating a lifetime deposit system. This system works to transfer the tenant’s deposit from one landlord to another. Further, it ensures increased accountability for the landlords like you.
Reform for more Energy-Efficient Properties
There is a prediction that the government will introduce a new rule or law to increase energy efficiency in the year 2022. According to the new legislation, it is expected that the landlords will be asked to make arrangements for the energy performance rating to be at least at level C. Previously the rating was expected to be at level E.
If you have a property with a lower than level C energy efficiency, you need to plan a renovation. It can be beneficial for you in the long run as it will help in the reduction of other costs like utility bills. It will help your tenants manage other costs and pay affordable rent.
The year 2022 can work out well for you as a landlord. With all the changes and the new laws, the industry can continue to grow. Increase in the rents and more efficient changes in the legislation and relaxation in the taxes; your business can grow in the years to come.