Tax relief schemes aimed at private landlords are helping them to collectively save more than £5 billion a year, according to a new study.
Researchers working for the Intergenerational Foundation (IF), which gathered these figures, have argued that the loopholes are too favourable towards landlords.
It was also suggested that they were the main reason why so many older landlords are pumping their savings into buy-to-let properties, making it harder for young adults to get on the housing ladder at all.
One of the most beneficial tax breaks for private landlords came from a deduction of interest on their property from taxable rent income. These deductions are responsible for almost half of landlords’ savings. According to ft.com, they were also able to collectively claim £2.52 billion worth of exemptions on repairs to their properties.
Speaking to finfacts.ie, theIntergenerational Foundation’s co-founder, Ashley Seager, questioned whether these tax breaks were useful for the housing market in its current state.
He said: “It is clear that most of these tax write-offs go to older landlords keen to take advantage of both the lack of housing supply and the demand for properties to rent by the under-35s.
“Furthermore, with so many MPs benefiting from a rental income themselves, there would appear to be little appetite within Westminster to level the playing field between landlords and young people.”