Angela Murfitt, a chartered financial planner at Fairstone Financial Management, agreed that the changes to the dividend tax system will create more complexity and therefore conversations with advisers will be required.
“As a result of today’s announcement, high earning buy-to-let investors will be hit by the tax changes to the interest rate offset. This will make property investment much more complex than it appears on paper, and it certainly isn’t going to be as lucrative from a financial point of view in the future.”
She added that those with property investments may want to unravel what they have started in light of this and will find that one of the pitfalls of property investing is liquidity.
Meanwhile, John Charcol’s senior technical manager Ray Boulger has also warned brokers to expect buy-to-let lenders to change their affordability calculations.