Buy to Let
Landlords urged to utilise green tax breaks
The National Landlords Association (NLA) has urged private-residential landlords to use a tax break allowing landlords to claim on their tax return against the cost of buying and installing energy saving items.
Landlords are able to claim a maximum of £1,500 per property against the cost of installing draught proofing, loft insulation, floor insulation, cavity wall insulation, solid wall insulation or insulation for hot water systems through the Landlord’s Energy Saving Allowance (LESA).
For example, if a buy to let landlord installs insulation at a cost of £1,500, the saving could be as much as £600 for higher rate income tax payers and £300 for those who pay basic rate Income Tax. From 1 October 2008, all rental properties with a new tenancy in England and Wales will be required to have an Energy Performance Certificate.
Prospective tenants will be able to see at a glance how energy efficient prospective rental properties are. Given a choice of properties, tenants may opt for one which is more energy efficient and could present them with lower bills.
David Salusbury, chairman of the NLA, said: “The NLA encourages its members to invest in maintaining and improving the quality of their properties. LESA is a welcome incentive for landlords to encourage them to make the necessary energy efficiency improvements.
“As well as contributing to the overall efforts by society to combat climate change, landlords may see an increase in the value of their investment as a result of energy efficiency improvements. We are pleased that the Government has chosen to offer incentives to landlords instead of regulation and would urge landlords to use the tax break or, perhaps, risk losing it in the future.”