According to reports of Treasury discussions, buy-to-let landlords could face a new national insurance (NI) levy on rental income. While no formal proposals have been published, speculation is growing that landlords may become a target for additional revenue.
At present, NI applies to employment and self-employment income but not property income. The standard rates are 8% on earnings up to £50,270 and 2% above this threshold. Any landlord levy is expected to be lower, with suggestions of a 1-3% surcharge, modelled on the stamp duty premium for second home buyers.
The introduction of Making Tax Digital for Income Tax in April 2026 could make such a policy easier to enforce. Landlords with annual income above £50,000 will be required to submit quarterly digital updates alongside a year-end return, giving HMRC closer oversight of their earnings.
With a £50 billion shortfall to address, the Treasury is exploring measures that might raise billions quickly. Early estimates suggest NI on rental income could generate £2bn, though it is unclear whether this figure relates to one year or the period to the next general election in 2029.
Landlords argue they are already under pressure from rising interest rates, which have fuelled record rents. The sector also faces uncertainty after speculation about cuts to capital gains tax relief on higher-value primary residences and possible changes to stamp duty for sales above £500,000.
The date of the Autumn Budget is yet to be confirmed.
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