Details emerge of property investor tax exemptions

The government made a shock announcement in March to remove a longstanding tax “loophole” that let property investors reduce tax bills by deducting mortgage interest payments against their rental income.

At the time, it said the changes would not include new builds.

Consultation documents out today detail the proposals to stop interest deductions being claimed for residential investment properties.

This includes how the new build exemption might work in terms of the interest claim limitations and the application of a five-year brightline capital gains test, rather than the ten-year test for other residences.