Autumn Budget 2025: What Changed for Landlords
Last updated 28 June 2026 · 9 min read · By the LandlordTaxAi Editorial Team
The short answer
The Autumn Budget 2025 was a significant one for landlords. Property income tax rates rise by 2 percentage points to 22% / 42% / 47% from April 2027, mortgage interest relief moves to 22%, a new mansion tax hits £2m+ homes from 2028, and MTD for Income Tax is now mandatory. The feared National Insurance on rent did not happen.
This is your one-page summary of everything in the 2025 Budget that affects UK landlords, with links to deeper guides on each measure. The theme is clear: the headline rates are unchanged for workers, but property income is being taxed harder, and the compliance bar is rising with Making Tax Digital.
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Are you in MTD — and when?
MTD for Income Tax is now mandatory. Check your start date based on your gross property and self-employment income.
Result
- Total qualifying income
- £28,000
- You must use MTD for Income Tax
- From 6 April 2028
April 2026 over £50k, April 2027 over £30k, April 2028 over £20k. Estimate only — not tax advice.
The changes at a glance
| Measure | What changed | From |
|---|---|---|
| Property income tax rates | Up 2ppts to 22% / 42% / 47% | Apr 2027 |
| Mortgage interest relief | Credit rises 20% → 22% | Apr 2027 |
| Mansion tax (HVCTS) | £2,500–£7,500/yr on £2m+ homes | Apr 2028 |
| MTD for Income Tax | Mandatory (over £50k first) | Apr 2026 |
| Income tax thresholds | Frozen, extended to 2030/31 | Ongoing |
| National Insurance on rent | Not introduced | – |
1. Property income taxed 2 points higher (2027)
From April 2027, rental profit is taxed at 22%, 42% and 47% — 2 points above the standard rates that still apply to salaries. For the first time, property income is taxed more heavily than employment income at every band. Read the detail in property income tax rising in 2027.
2. Mortgage interest relief rises to 22%
The Section 24 finance-cost credit moves from 20% to 22%, in line with the new property basic rate. It is a small saving that is more than offset by the rate rise for most landlords — see mortgage interest relief rising to 22%.
3. The new mansion tax (2028)
A High Value Council Tax Surcharge starts in April 2028 on English homes worth £2m+, banded from £2,500 to £7,500 a year and paid by the owner. For landlords of prime property, this is a recurring annual cost — see the High Value Council Tax Surcharge explained.
4. MTD for Income Tax is here
Making Tax Digital for Income Tax is mandatory from April 2026 for landlords with gross income over £50,000, falling to £30,000 in 2027 and £20,000 in 2028. Quarterly digital updates and compatible software are now part of landlord life — see MTD software for landlords.
5. No National Insurance on rent
The most-feared rumour did not materialise. Rental income stays outside National Insurance — see will landlords pay National Insurance?
With thresholds frozen and rates rising, the practical effect is a steadily heavier tax burden on landlords — making accurate expense claims and clean MTD records more valuable than ever.
Built for the post-2025-Budget landlord
LandlordTaxAi reads your bank statements, categorises every transaction to HMRC’s SA105 rules and keeps you MTD-ready — so a tougher tax regime doesn’t mean tougher admin.
See how it worksFrequently asked questions
What were the main Budget 2025 changes for landlords?
Property tax rates rise to 22% / 42% / 47% from April 2027, mortgage interest relief moves to 22%, a mansion tax starts in 2028 on £2m+ homes, MTD is mandatory from April 2026, and there is no NIC on rent.
When do the property rate rises start?
From 6 April 2027. Income for 2026/27 is still taxed at 20%, 40% and 45%.
Will landlords pay National Insurance on rent?
No. The Budget confirmed property income remains outside National Insurance.
Were income tax thresholds changed?
No — they remain frozen, now extended to 2030/31. The personal allowance stays at £12,570.
What is the mansion tax?
A High Value Council Tax Surcharge on English homes worth £2m+, from April 2028, banded £2,500–£7,500 a year and paid by the owner.
Did CGT on property change?
Residential CGT stays at 18% / 24% with a £3,000 annual exempt amount, reported and paid within 60 days.
Written and reviewed by the LandlordTaxAi Editorial Team. Our guides are reviewed against current HMRC and government guidance and updated when the rules change. Operated by LandlordTaxAi, United Kingdom. Follow us on LinkedIn.
Last reviewed: 28 June 2026 · Researched against primary UK sources: https://www.gov.uk/government/publications/budget-2025-overview-of-tax-legislation-and-rates-ootlar/budget-2025-overview-of-tax-legislation-and-rates-ootlar ; https://www.gov.uk/government/publications/changes-to-tax-rates-for-property-savings-and-dividend-income/change-to-tax-rates-for-property-savings-and-dividend-income-technical-note ; https://www.gov.uk/government/consultations/high-value-council-tax-surcharge/high-value-council-tax-surcharge . This article is informational only and does not constitute tax advice. Check the latest details on GOV.UK or with a qualified accountant.