Landlords who want to offer homes to Ukrainian refugees will be hit by tax bills worth thousands of pounds because the tax office has failed to update its rules to support the Government’s flagship resettlement scheme.
A policy designed to stop people sitting on empty properties will penalise buy-to-let investors who offer homes to refugees for free.
Anyone who owns a property via limited companies must pay the “Annual Tax on Enveloped Dwellings” if they do not receive any rent. This is a £3,800 charge for every home worth between £500,000 and £1m and £7,700 for those between £1m and £2m.
Tim Walford-Fitzgerald, of accountancy firm HW Fisher, said one portfolio landlord has a £700,000 home they want to make available to Ukrainian refugees, but will face a £3,800 bill if they do.
He called on HM Revenue & Customs to grant an exemption to landlords wanting to let properties to refugees for free. “The rental market is red hot at the moment. These are generous people who are willing to forego their income for the greater good and HMRC should not be dumping a bill on them,” he added.
