In April 2019 the government introduced new legislation to ring-fence losses made by residential rental properties from the 2020 tax year onwards. What this means for those that own residential rental properties is that they will no longer be able to offset any tax losses the properties make against their general personal income.
If you have multiple residential rental properties these will be treated on the default basis which is known as the “Portfolio Basis” unless you elect the alternative which is to treat them on a “Property by Property Basis”. Under the “Portfolio Basis” all your rental profits and losses will be grouped together and any losses as a result of this grouping will be ring-fenced or you will pay tax on the combined profit if the portfolio is in a profitable position.
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