UK Budget 2025: Key Points for Property Buyers, Landlords, and Business Owners
The UK Budget 2025, announced on 26th November 2025, introduces several important
measures that will shape the property market, tax landscape, and mortgage lending in the
years to come. While some changes are a few years away, others are more immediate and will
have a direct impact on property buyers, landlords, and business owners.
Here’s a breakdown of the key points, with our take on how these changes might impact
you:
1. Mansion Tax: New Levy on High-Value Properties
Effective from April 2028
A new mansion tax will be introduced for properties worth over £2 million. This move is aimed at high-value property owners, particularly in areas like London, where many homes already fall into this price bracket. While this may sound like it only affects the wealthy, it could also have a ripple effect across the wider property market, particularly in expensive locations.
Our Take:
While the mansion tax is targeted at high-value properties, it could lead to a slowdown in demand for these homes, especially in London and the South East. This might impact property values and could create opportunities for buyers looking in these segments. As property valuations adjust, lenders may also become more conservative in their lending, so buyers and investors in this market will need to take a strategic approach when considering property purchases and mortgages. At London FS, with our expertise, we can help navigate this uncertainty, providing clarity on the potential impact for both buyers and sellers in the luxury market.
2. No Change to Stamp Duty
Stamp Duty Remains Unchanged
Despite some speculation of changes, stamp duty rates will remain the same. This means buyers will still face the existing stamp duty thresholds when purchasing a property, with no immediate changes to help ease the burden of this often hefty cost.
Our Take:
While there may have been hopes for reductions to stimulate the property market, especially for first-time buyers, stamp duty remains a significant factor in affordability. For many buyers, particularly in higher-priced areas, this continues to be a barrier. Buyers who had been waiting for a stamp duty cut may now feel more encouraged to move forward with their plans, but affordability remains a key challenge. At London FS, with our expertise, we can help clients explore strategies to manage stamp duty costs and ensure they secure the best mortgage options, even when the tax burden is high.
3. Landlord Tax Increase: Impact on Property Investors
2% Tax Increase from April 2027
The government has announced a 2% tax increase for landlords, particularly those with larger property portfolios. This change will come into effect from April 2027 and could prompt many landlords to restructure or downsize their portfolios to reduce the tax burden.
Our Take:
For many property investors, this tax increase may feel like a blow to their rental income. At London FS, with our expertise, we can help landlords assess the impact of these changes and develop strategies for managing their portfolios moving forward. Whether it’s through refinancing, restructuring, or finding tax-efficient mortgage products, we’re here to ensure that landlords continue to get the best returns on their investments. We also anticipate an uptick in mortgage restructuring requests, as investors look to manage this increased tax liability.
4. Dividends Tax Rise: Impact on Small Business Owners
2% Tax Increase from April 2026
A 2% increase in dividend tax will be introduced in 2026, which will affect small business owners and directors who pay themselves a low salary and take additional income in the form of dividends.
Our Take:
This rise in dividend tax could have a direct impact on the way business owners draw income, which might affect their mortgage affordability calculations. At London FS, with our expertise, we can help business owners adjust their income structures in light of these changes, ensuring they can still qualify for the best mortgage products available. By working closely with accountants and other financial professionals, we can help business owners remain financially healthy while navigating the complexities of the new tax regime.
How London FS Can Help
In light of the UK Budget 2025, London FS is here to help you make informed decisions about your property or business plans. We understand that changes in the financial landscape can feel overwhelming, but with 15+ years of experience, we offer clarity—no scaremongering.
Whether you’re a first-time buyer, property investor, or a business owner needing to reassess your financial strategy, our expert team is here to help you navigate these changes and find the right mortgage or financial solution. Our 5-star Trustpilot rating is a testament to our commitment to providing clear, expert advice that puts your needs first.
Get in touch with us today:
📞 +44 (0)208 427 5057
📧 enquiries@london-fs.com
🌐 www.london-fs.com
We’re here to help you navigate the changes and make confident, informed decisions every step of the way.
Final Thoughts
The UK Budget 2025 has brought about key changes, including the mansion tax, landlord tax increase, and dividend tax rise, all of which will shape the property and business landscape in the coming years. For property buyers, landlords, and business owners, it’s essential to stay informed and plan ahead. At London FS, we’re committed to helping you navigate these changes with confidence and clarity, ensuring that you always make the best financial decisions.
