The latest Budget on 28 October 2026 includes several announcements landlords and property investors should note, particularly when planning for the next few years.

Changes to property income taxation, together with continued pressure from mortgage interest rates, mean landlords increasingly need to understand how the changing tax landscape could affect their portfolio profitability.

Income Tax on property income

Property income includes income received from letting land and buildings.

Individuals currently benefit from a £1,000 Property Allowance. If your annual property income is £1,000 or less, you generally do not have to pay tax on it. If your property income exceeds £1,000, you can usually choose to deduct the £1,000 allowance or claim allowable expenses when calculating your taxable profit.

One key announcement affecting landlords is an increase in the Income Tax rates that apply specifically to property income.

From the 2027/28 tax year, the rates will be:

• 24% for basic rate taxpayers
• 44% for higher rate taxpayers
• 49% for additional rate taxpayers

These rates are 2% higher than those previously announced at Budget 2025.

For landlords with significant rental income, this could noticeably affect the profit retained after tax. It also makes forward tax planning increasingly important, particularly for those considering expanding or restructuring their property portfolios.

Capital Gains Tax remains unchanged.

Capital Gains Tax rates remain unchanged for 2027/28.

The Capital Gains Tax annual exempt amount for individuals will also remain at £3,000.

Landlords considering selling a property should therefore continue to factor Capital Gains Tax into their plans. The timing of a disposal and the individual's wider tax position can make a difference, so seeking advice before selling can help.

Stamp Duty change for assured tenancies

The government will remove Stamp Duty Land Tax on rent paid under assured tenancies in England from 1 May 2026, following the introduction of the Renters’ Rights Act 2025.

The change is intended to prevent tenants with periodic tenancies from unintentionally becoming liable for Stamp Duty Land Tax when the net present value of their rental payments reaches the relevant threshold.

What is happening to house prices and mortgage costs?

The wider economic outlook also matters for landlords planning their investments.

The Office for Budget Responsibility (OBR) forecasts house price growth of around 2% in 2026 and 2.5% in 2027.

However, borrowing costs remain an important consideration. The OBR expects the average effective interest rate across outstanding mortgages to rise from around 4% in 2026 to about 5% by 2031 as borrowers refinance and market rate changes feed through.

For landlords with mortgages, particularly those planning to grow their portfolios, higher borrowing costs combined with increased taxation of property income could put further pressure on returns.

Planning ahead

Property investment remains a long-term commitment, and understanding the tax and financial implications before making major decisions is increasingly important.

If you are an existing landlord, considering expanding your portfolio, or planning to buy your first buy-to-let property, our Property Hub brings together specialist support covering property taxation, mortgages, and financial management.

Getting advice early can help you understand the numbers, assess potential returns, and structure your property activities appropriately before you commit. You can call us on 01623 490 120 or email This email address is being protected from spambots. You need JavaScript enabled to view it.