Budget 2026 for landlords: tax on rent, the £65 registration fee and what comes next
Tax on rental profit rises to 24%, 44% and 49% from April 2027. Landlords in England will pay £65 a year per property to register. The service rolls out from 15 December. HMRC is consulting on letting agents reporting your rent. And the OBR thinks rents are more likely than not to rise over time.
Published , the day of the Budget. Every Budget figure links to the official document it comes from. General information, not tax or financial advice.
Budget 2026 guides: All 21 points · Tax · Building and buying · Landlords
How much tax will I pay on rent?
From 6 April 2027, 24%, 44% or 49% of your rental profit, by income band.
That is up from 20%, 40% and 45%. It covers England, Wales and Northern Ireland. More in the tax guide.
| Band | 2026-27 | From 6 April 2027 |
|---|---|---|
| Basic rate | 20% | 24% |
| Higher rate | 40% | 44% |
| Additional rate | 45% | 49% |
What happens to mortgage interest relief?
The tax credit rises from 20% to 24% from 6 April 2027.
It follows the basic rate. It stays at the basic rate, even if you pay 44% or 49%.
Source: Budget 2026 policy costings, p.74.
What is the £65 landlord registration fee?
Landlords in England will pay £65 a year for each rented property. The service starts rolling out on 15 December 2026.
It pays for the new "Register your rental property" service. The fee may be pro-rated while it rolls out. Registering will be the law. Councils can take action against landlords who do not register.
Source: Budget 2026 policy costings, p.108.
Will letting agents report my rent to HMRC?
Possibly. HMRC is consulting on it until 20 January 2027.
The plan covers letting agents and tenancy deposit schemes. They would send HMRC data on landlords' rental income.
Source: Budget 2026, para 2.35; Improving Property Income Data Reporting, HMRC.
What changes for Making Tax Digital?
Joining in April 2027? Late updates in your first year will not get penalty points.
Making Tax Digital means sending HMRC quarterly updates online. The easing covers your first four updates, for 2027-28.
Source: Budget 2026, para 6.152.
What changes for payments on account?
From April 2029, you will pay smaller amounts, more often.
Payments on account are advance payments towards your tax bill. In the 2029-30 changeover, you pay towards two tax years at once. Plan for the cash.
Source: Budget 2026, para 2.33; OBR, para 3.25.
Is VAT on insulation and heat pumps going up?
Yes. It goes from 0% back to 5% on 1 April 2027.
This was already planned. It covers energy-saving materials fitted in homes, such as insulation, heat pumps and solar panels. Heat batteries join the list.
Source: Budget 2026, para 6.215.
Will short lets pay a visitor levy?
They may. Mayors and other regional authorities in England will get the power to charge one.
It would be a percentage of the price of each overnight stay. It would apply to short-term, commercially let visitor accommodation, with limited exemptions. The host would be liable, not the guest. The law is still to come.
Source: Budget 2026, para 4.60; Fiscal Devolution Roadmap, paras 2.40 to 2.43.
I let a home worth £2 million or more. Who pays the surcharge?
You do. From April 2028, owners pay it, not tenants.
See the bands in the tax guide.
Source: HVCTS factsheet.
What does the OBR say about rents?
It thinks rents are more likely than not to rise steadily, as demand outstrips supply.
It says the two tax rises "represent a material reduction in returns to private landlords". That comes on top of earlier measures. In its words, they risk "a steady long-term rise in rents if demand outstrips supply – which we think is more likely than not".
Fewer people may start letting, and some landlords may pass costs on.
Source: OBR, Economic and fiscal outlook, October 2026, para 3.46.
Converting or extending a rental? Check if you need planning permission, free, with Planning Approvals, by Mayfair Studio. Any property in England.
Thinking about building instead of letting?
See 13,512 sites on one map. Most are council brownfield land. The rest are planning approvals where we found no sign anything was built.
Members see a screening estimate of the most you could pay. They also see how to find the owner.
Free to join, no card. The first 50 members get half price.
Sources
- Budget 2026 (the Red Book), HM Treasury, 28 October 2026
- Economic and fiscal outlook, October 2026, Office for Budget Responsibility
- Budget 2026 policy costings, HM Treasury
- Your First Home and High Value Council Tax Surcharge factsheets, GOV.UK
Checked against the published documents on . Details can change as legislation is drafted, so check the latest guidance or speak to a qualified adviser before acting. Spotted an error? Email [email protected].
Budget 2026 guides: All 21 points · Tax · Building and buying · Landlords