Not proposed. Legislated, in the Finance Act 2026. Two percentage points above the earned income rates at every band, on top of a finance cost restriction that still only gives you basic-rate relief on your interest — and an EPC C deadline in 2030. Four pressures landing on the same portfolio, and most models have repriced for none of them.
Individually each of these is survivable and each has been written about separately. What almost nobody has done is run them through the same model at the same time, on the same properties — which is the only way to see that the answer differs property by property rather than portfolio-wide.
Rental profits move to their own rates of 22%, 42% and 47% — two points above the equivalent earned income rates — under the Finance Act 2026. The stated rationale is that rental income carries no National Insurance.
A higher-rate landlord loses another 2% of gross profit, every year, forever.Section 24. Mortgage interest is not deductible from rental profit; you get a basic-rate 20% tax credit instead, whatever rate you actually pay. Personally held and geared is the combination it punishes.
Interacts brutally with the 2027 rates: you are taxed at 42% on profit you did not make.Every privately rented home to EPC C, with a £10,000 per property cost cap and spend from 1 October 2025 already counting against it. Below the cap it is a cost; above it, an exemption and a narrower buyer pool.
Turns a low-yielding F or G into a genuinely stranded asset.Quarterly digital reporting from 6 April 2026 for combined gross income over £50,000, dropping to £30,000 in April 2027 and £20,000 in April 2028. Not a tax, but a real and recurring administrative cost.
The point at which a small portfolio stops being a spare-time activity.Every one of these bites differently depending on the individual asset. A low-geared flat at EPC C in a strong rental area barely notices any of it. A heavily geared house at EPC F in a weak market, held personally by a higher-rate taxpayer, is hit by all four at once and may already be losing money on a cash basis once you count the capex it has not yet spent. The instinct in this position is to make a portfolio-wide decision — sell up, or incorporate everything, or ride it out. That is almost always wrong, because the variance between your properties is larger than the average across them. The useful exercise is to score each asset separately and then decide.
Add your properties and we will classify each one — hold, upgrade, refinance, restructure or sell — on cashflow after tax, after regulatory capex, at today’s rates and at the 2027 rates. Nothing is sent anywhere. It is a model rather than advice, and the assumptions are stated so you can argue with them.
A model, not advice. It assumes running costs at 22% of rent, regulatory capital expenditure spread evenly over ten years, and interest-only borrowing. It does not model your personal allowances, other income, capital growth or the tax on a sale. We are not tax advisers — where a restructuring is worth considering, it needs an accountant before anything else.
Five outcomes, and only one of them is selling. The most common finding on a real portfolio is that two or three assets are dragging the whole thing down and the rest are fine — which is a far cheaper problem to solve than the one people think they have.
Covering its costs after tax and after the capex it will need, with the 2027 rates already applied. No action beyond keeping the compliance right. Most portfolios have more of these than the owner expects.
The economics work but the fabric does not. Spending on EPC now, inside the £10,000 cap, protects both the lettability and the resale. The trap is leaving it to 2029, when every landlord in the country is bidding for the same contractors.
Low gearing and trapped equity. The asset is fine; the capital is idle. Releasing it funds the upgrades elsewhere in the portfolio, which is usually cheaper than selling something to pay for them.
The asset is sound but the ownership is wrong — typically geared, personally held and higher rate, where section 24 and the 2027 rates compound. Incorporation is one answer and an expensive one: stamp duty on transfer, capital gains on disposal to the company, and incorporation relief only where it is genuinely a business. Model it before you like it.
Where the capex to make it compliant exceeds what the asset will ever return, or where it cannot reach EPC C within the cap and the yield does not justify holding an exempt property. Selling into a market that has not yet fully priced 2030 is a different proposition from selling in 2029 alongside everyone else.
The order matters more than the individual decisions. Refinance the low-geared asset to fund the upgrades, sell the stranded one into the current market, and time the disposals across tax years to use the annual exemption. That sequencing is the actual advice.
A strategy review is only as good as the data underneath it, and on most portfolios that data does not exist in one place. If you cannot produce every EPC, every certificate, the licensing position in each borough and a real capex forecast, then the first month of this engagement is us assembling that — which is the compliance work, charged as strategy. It is far better value to get the register built first and then run the strategy over data we already hold. If you are already a compliance client, the review is quick and much cheaper, and we will say so. If you are not, we would usually suggest starting there and coming back to this in a quarter.
A fixed fee, payable whatever the conclusion — including if the answer is hold everything. And it is materially cheaper if we already hold your compliance data, because most of the cost is assembling it.
We are not tax advisers and this is not tax advice. Where the model flags a restructuring, that is a prompt to take it to an accountant — incorporation carries stamp duty on transfer and a capital gains disposal to the company, and section 162 incorporation relief is only available where the letting is genuinely a business. Where we manage a disposal afterwards that is a separate instruction on separate terms, and you are under no obligation to use us. The review fee does not vary with the conclusion, deliberately: a firm paid more for recommending a sale should not be the firm telling you to sell.
How many properties, roughly what they are worth, and how much debt is against them. That is enough for us to tell you whether a review would find anything — and whether you should do the compliance work first instead, which is often the honest answer.
Four questions. We will come back with what we would model, what we would need from you and what it costs — including whether you should do the compliance work first.
Including anything held in a company or jointly.
Choose as many as apply.
Areas or postcode districts is plenty at this stage.
No charge for the conversation. If the honest answer is that you should build the compliance data first, we will tell you that instead of selling you a review.
Check it over. Tapping the button opens WhatsApp with this ready — nothing has been sent yet.
Send this on WhatsAppEvery one of these has a free tool on it. None of them asks for your details before it gives you an answer.
Your outsourced compliance department. Certificates, licences, tenancy duties and local schemes, tracked per property.
Obligation register, twelve-month calendar and a start planfrom £9 a month →A costed, sequenced route to the 2030 standard against the £10,000 cap — then the works run.
Retrofit pathway planner, domestic and commercialfrom £250 →What the law will cost you over a ten-year hold, before you commit to buying.
Ten-year capex forecaster with the yield impactfrom £450 →Yes, and unusually for this field they are legislated rather than announced. The Autumn Budget 2025 introduced separate rates for property income of 22%, 42% and 47% from April 2027 — two percentage points above the equivalent earned income rates at each band — and the Finance Act 2026 contains the provisions implementing them. They apply in England, Wales and Northern Ireland; Scotland sets its own income tax rates. The stated rationale is that rental income carries no National Insurance, so the Treasury is pulling it closer to the tax paid on wages. We flag this specifically because a great deal of property regulation is reported as settled when it is a consultation. This one is not.
Possibly, and it is far more often floated than it is worth doing. In a company, interest is deductible against profit and corporation tax applies rather than the new property income rates, which is exactly why the model flags heavily geared personally held assets. Against that: transferring property to a company is a disposal for capital gains and an acquisition for stamp duty, including the additional dwelling surcharge, so the entry cost is frequently six figures on a modest portfolio. Incorporation relief under section 162 can defer the gain but only where the letting is genuinely a business rather than a passive investment, which is a question of fact and degree. We can model it. We cannot advise on it, and anyone who tells you the answer before seeing your numbers is selling something.
Not on its own, no. It is a model running on five inputs per property and stated assumptions — running costs at 22% of rent, interest-only borrowing, capex spread evenly over ten years. It does not know your actual void history, your maintenance record, the local rental market, your other income, your capital growth expectations or the tax you would pay on a sale. What it is good for is finding the two or three properties that behave differently from the rest, which is the finding that matters and the one a spreadsheet averaging the portfolio will hide. Treat a sell verdict as a prompt to look properly at that asset, not as an instruction.
On some assets, genuinely yes. On a low-geared property at EPC C in a decent rental area, none of the four pressures is severe and doing nothing is a legitimate strategy. Where waiting is expensive is on the assets that are already marginal: the 2027 rates are legislated so that cost is coming whatever happens, EPC works get more expensive as 2029 approaches and every landlord competes for the same contractors, and a stranded asset sold in 2029 is competing with every other stranded asset. The honest framing is that waiting is a decision with a price, and the price differs by property. That is what the tool is for.
Sometimes possible, often not, and it is worth being clear-eyed about it. Rent is set by the local market rather than by your costs, and from 1 May 2026 the Renters’ Rights Act removed several of the mechanisms landlords used to reprice quickly — no fixed terms, no section 21, one rent increase a year by statutory notice, and a tenant able to challenge the increase at tribunal. Where the market genuinely supports higher rent you will already be close to it. Where it does not, the tax increase falls on you. Modelling it as recoverable is the most common error we see in a landlord’s own spreadsheet.
The compliance work first, in most cases, and we would rather say so. A strategy review is only as good as the data underneath it. If you cannot produce every EPC, every certificate, the licensing position in each borough and a real capex forecast, then the first month of this engagement is us assembling that — which is compliance work billed as strategy, and poor value. Clients already on our compliance service get this review far more cheaply and far faster, because we hold the data. If you are not, we will usually suggest building the register first and coming back to this in a quarter. That is a smaller invoice now and a better answer later.
We can manage a disposal and we will tell you plainly that this is where our incentives need watching. A firm that advises you to sell and then earns a commission on the sale has an obvious problem, so the review fee is fixed and payable whatever the conclusion, and if the answer is hold on every property you have still paid the same. If you want us to handle a disposal afterwards that is a separate instruction on separate terms, and you are under no obligation — several clients take the analysis and use their own agent, which is a perfectly sensible thing to do.
The pressure is real and it is legislated, but it does not fall evenly. The properties dragging your returns down are usually identifiable, few, and fixable by disposal or by spending — and knowing which is which is a modelling exercise, not a mood.
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