The landlord group, which was led by QC Cherie Blair, argued that the changes were both “unfair and unlawful”, and that the case should go to a full judicial review hearing. However, Mr Justice Dingemans ruled the challenge “arguable” and dismissed it in the Administrative Court. The changes proposed in Section 24 of the Finance (No.2) Act 2015 will stop buy-to-let finance costs – largely mortgage interest – being a claimable business expense. Most landlords with mortgages will now have to pay tax on their turnover rather than profit. The amount of mortgage tax relief they can claim will also be cut from 45% to 20% from 2017 to 2020. Blair represented Steve Bolton, chairman of Platinum Property Partners, and landlord Chris Cooper on behalf of the Axe the Tenant Tax coalition. She said: “The court’s decision that our clients’ legal challenge should not proceed is very disappointing. “Steve and Chris, and many others, have dedicated a lot of time and energy into putting forward the best case possible. “We know the case has been supported and followed with interest by a large number of individual landlords. Many of these landlords now face challenging times ahead”. The tax change will only affect individuals who own rental properties in their own names, like the millions of smaller landlords in the UK. Companies owning buy-to-let property and wealthy cash investors are excluded from the tax. In a joint statement, Mr Bolton and Mr Cooper said: “We are outraged by the court’s decision today. It has completely missed the opportunity to protect tenants, landlords and the housing market from the disastrous consequences of Section 24”.
