Welcome to our monthly newsletter, designed to keep property landlords informed about key industry updates, legislative changes, and market trends. If you have any questions, feel free to contact us for expert advice.
Government Reforms to Modernise Home Buying
On 9 February 2025, the UK government announced major reforms aimed at modernising the home buying and selling process. These changes are designed to reduce transaction times and prevent property deals from falling through.
Key Highlights:
- Digitalisation of Property Transactions: The government plans to streamline processes by enabling trusted professionals within transaction chains to share key property data digitally.
- Digital Identity Verification: The introduction of digital ID services will further reduce delays and enhance security in property transactions.
- Land Registry Modernisation: The Land Registry will lead a 10-month pilot project with councils to digitise property records and improve data accessibility.
- Right to Manage Legislation: New rules coming into effect on 3 March 2025 will empower more leaseholders, making it easier for them to take control of their buildings and manage service charges.
Sonder Europe VAT Ruling Update
In our February newsletter, we covered the Upper Tribunal’s ruling that Sonder Europe Ltd’s serviced apartment stays are not eligible for the Tour Operators Margin Scheme (TOMS) for VAT purposes. This means VAT must now be calculated under standard rules rather than on margins.
There may still be further legal developments, as Sonder is expected to seek permission to appeal the decision to the Court of Appeal. We will provide updates as the case progresses.
Edinburgh Tourist Tax Introduced
The Edinburgh Visitor Levy will officially take effect from 26 July 2026, applying to pre-bookings made from 1 October 2025. The tax, referred to as a ‘tourist tax,’ will require visitors to pay 5% of the pre-VAT accommodation cost for the first five consecutive nights.
Who Will Be Affected?
- Hotels, hostels, and B&Bs
- Self-catering accommodations
- Caravan and camping sites
- Student accommodations rented as visitor stays
- Vehicles and boats that remain in one location
Reimbursement: A 2% reimbursement of the levy will be provided to accommodation providers to offset collection costs.
Proposed EPC Rating Changes for England & Wales
The UK government is consulting on new Energy Performance Certificate (EPC) regulations that would require all private rental properties to achieve a minimum EPC C rating by 2030.
Current and Proposed Standards:
- Currently, 48% of private rental homes meet EPC C or higher.
- The current minimum EPC rating requirement is E.
- Landlords may face compliance costs between £6,100 and £6,800 per property.
Key Consultation Points:
- Mandatory fabric standard upgrades (e.g., loft insulation, double glazing) before considering renewable energy solutions (e.g., solar panels, smart meters).
- A proposed £15,000 cap per property for upgrade costs.
- An affordability exemption reducing the cap to £10,000 for qualifying landlords.
- A requirement for all properties to comply by 2030.
The consultation closes on 2 May 2025. If you are a landlord, we encourage you to participate in the discussion, the details can be found here.
Making Tax Digital (MTD) for Landlords & Jointly-Held Property
From 6 April 2026, the first group of unincorporated landlords will be required to comply with Making Tax Digital (MTD) for Income Tax. HMRC has recently introduced record-keeping and reporting easements for those with jointly-held property income.
What Landlords Need to Know:
- Digital record-keeping will become mandatory.
- Landlords must submit income tax returns through compatible MTD software.
- HMRC has issued guidance on joint property ownership to clarify reporting obligations.