The law is proposed to be changed regarding rental losses. For many years, investors in property have had a tax deduction, against their other income, for losses on rental property. Starting from 1 April 2019, residential property owners may no longer be able to set off their losses as previously.
The losses will accumulate and be carried forward to offset future rental profits.
The details are yet to be worked out. For example, if you have several properties, some making profits and others making losses, will you be able to offset the losses against the rental profits?
Also, under the current proposal, these rules are going to be applied to residential property and not commercial property.
For further details, please contact our tax team to discuss how this proposed change may impact on you.