PRA urges buy-to-let lenders to toughen up rules

The Prudential Regulation Authority, part of the Bank of England, has warned buy-to-let lenders to take into account the reduction in mortgage interest tax relief when assessing applications.

Richard Hepburn, operations manager at Gorilla Accounting said: “With the reduction in tax relief available to buy-to-let landlords, who own property personally, there has been an increase in the amount of investors looking to purchase properties via a limited company.

“When considering the best approach, it is important to speak to a specialist tax adviser who can review your circumstances and advise on which route will be best.

“It is important to consider any other taxable income you may have and if you will be purchasing the property individually or jointly before making the purchase.”

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