A date for the legal challenge against the impending changes to landlord taxation in the UK to be heard has now been set.
Led by Cherie Booth QC, a judicial review into the new taxation for landlords will be heard in the Royal Courts of Justice in London on October 6th.
The proposed changes would mean that landlords’ Income Tax liability will be reduced by a basic rate tax reduction, after the income tax on property profits and other incomes sources has been assessed.
This could mean that landlords with higher and additional tax rates will end up paying tax on their turnover and not the profit they are making. Landlords with a basic rate tax might also be pushed into the higher tax bracket even if they are not earning any extra income.
The challenge has been backed by many UK landlords and campaigners who claim that if the new law were to be instigated, many landlords in the UK may be forced to sell their investment properties.
The law, as it is currently drafted, is set to affect both UK and non-UK landlords who own property in their own name.
Exempt from the new taxation at present are UK and non-UK resident companies, and landlords of furnished holiday lettings. This distinction will form a part of the appeal, as European law states that the Government is not permitted to favour one type of landlord over another.
The new law is currently scheduled to be phased in from April 2017 and is expected to be fully implemented by April 2020.