Lee Sharpe considers the tax implications for landlords of buy-to-let properties after interest rates have risen significantly in little over a year.
The Bank of England base rate was a mere 0.1% in September 2021 and stayed there until the end of that year. At the time of writing (late September 2023) it is now 5.25%. Some of us are old enough to remember when mortgage rates reached more than 15% p.a. but I don’t think we have ever seen base rates rise by more than 5,000% in such a relatively short period of time.
What are the implications for a tax regime last reformed at a time when interest rates were immodestly modest, but borrowing was nevertheless still quite accessible?
As with so many tax travesties, we need briefly to cast our minds back to summer 2015, when Chancellor George Osborne, the hitherto largely unsung ‘Angel of&