Are you a buy-to-let landlord?
Have you carried out any repairs recently which have helped you to meet your energy efficiency standards responsibilities? Well, did you know that you can claim tax relief on those improvements? If you hadn’t realised this, then make your claim before it is too late. If you weren’t aware of this relief, then Steven Glicher accountants would urge to make your claim as quickly as possible as the deadline for claiming is less than 5 weeks away.
The buy-to-let property energy efficiency standards tax perk, the Energy Savings Allowance, is due to expire on 6 April 2015. Using this tax relief, landlords are able to claim income tax relief. Landlords using the Energy Savings Allowance tax perk can claim £1,500 tax relief per property on works to boost energy standards such as new insulation or a new boiler. What’s more, an additional £5,600 of Green Deal cashback is also available. However, it should be noted that the application process is long and involved, so landlords should apply as soon as possible if they wish to make a claim.
The new energy savings rules come into force in just over 3 years’ time, so landlords intending to make home improvements to properties should ideally commence work as soon as possible. Why are these new regulations important for buy-to-let landlords? Well, the new regulations stipulate that from April 2018, all rental properties must have an Energy Performance Certificate (EPC) rating of Band E or higher. If landlords fail to comply with these standards they will be unable to let their properties.
What are EPC ratings?
Well, they are energy efficiency ratings. The EPC rating scale goes from A (very efficient) to G (highly inefficient). The Government claims tenants pay up to £880 more per year for energy if they rent a property whose rating is below Band E. So it wants landlords to take action to reduce energy emissions and to help tenants cut fuel bills.
News of the imminent expiry of the Energy Savings Allowance has met with criticism. Commentators say it is unreasonable to withdraw tax relief whilst imposing energy efficiency improvement targets on landlords. David Weatherall, of the Energy Saving Trust, told the Telegraph newspaper:
“We should not let this policy expire and die just when it could be really useful.”
The British Property Federation, Energy Saving Trust, Citizens Advice and National Landlords Association (NLA) are all appealing for the Government to renew the tax relief. The NLA said it was good business practice for landlords to improve their homes but questions remained over what constituted ‘unreasonable’ works exempt from tax reliefs.
How can you claim your Energy Savings Allowance tax relief or Green Deal cash?
- Buy-to-let landlords can claim their £1,500 tax perks via their self-assessment tax return.
- Green Deal cash for home improvements is available on a first-come, first-served basis, with the next release of funds expected in April, 2015. To qualify, landlords must first pre-book a Green Deal assessment appointment. The resulting report will then outline what work is needed and you will then be able to apply for vouchers to complete this work.
For further information on the Energy Savings Allowance, contact Steven Glicher accountants on 0161 485 8007 or email info@