Proposed National Insurance Charge on Landlords: What You Need to Know

The government is reported to be considering extending National Insurance (NI) contributions to rental income. This measure is being explored as Chancellor Rachel Reeves looks to address a projected £40–£50 billion gap in the public finances.

Currently, rental income is subject to income tax but not National Insurance. If introduced, this change could raise around £2 billion a year for the Treasury by broadening the tax base.

What Could It Mean for Landlords?

While the proposal is still under consideration, early estimates suggest:

• Additional costs – On average, landlords could face around £722 per property annually, rising to £885 in London.

• Impact on tenants – Some landlords may pass on these costs to renters, potentially adding up to £1,000 per year in higher rents.

• Market behaviour – Landlords might restructure through limited companies to reduce liability, or even exit the market, further limiting supply.

Wider Concerns

Industry voices argue that the measure risks unfairly targeting property investors, who already face significant regulatory changes, mortgage pressures, and compliance obligations. There is concern that this approach could reduce housing supply, increase rents, and add complexity without delivering the expected revenue.

Stay Informed, Stay Prepared

At this stage, no decision has been finalised. However, the idea forms part of a wider review of potential property-related tax changes expected in the Autumn Budget.

At MW Tax, we are committed to keeping our clients and community informed on the latest tax developments. If you are a landlord or property investor and would like to discuss how these potential changes could affect you, please feel free to get in touch.