Call for Ministers to provide energy efficiency support to landlords
A group of banks and building societies, consumer groups and landlord bodies have written to the Chancellor of the Exchequer to encourage new fiscal support to improve energy efficiency standards in the private rented sector.
One in four households in the UK private rented sector is in fuel poverty. Around two-thirds of privately rented properties in England and Wales fall below EPC C, the government’s target rating for all fuel-poor homes by 2030. However, there are currently no universally available incentives for landlords to increase the energy performance of their property.
The letter – supported by groups including Nationwide Building Society, Citizens Advice, the National Residential Landlords Association, Propertymark and Homes for Good letting agent – notes that a “simple tax restructuring to allow energy performance improvements to be offset against rental income could help make investment more attractive for landlords”. Individual landlords currently pay income tax on their rental properties at the same rates of tax as other earned income. Landlords may deduct costs of managing the property, legal fees, replacement furniture, insurance, utility bills, ground rent and maintenance and upkeep – but not energy-saving improvements. The letter encourages this allowance to be expanded to include expenditure on improvements that result in an increase in the efficiency of the property.
The call comes after Housing Secretary Michael Gove indicated that he wanted to delay the planned introduction of higher energy efficiency standards for the private rented sector, raising the minimum requirement to EPC C by 2025. E3G highlights how fiscal incentives can help pave the way for higher standards – as seen in Scotland, Germany and France – making investments more attractive to landlords.
