Legal challenge to buy to let tax change: HMRC to respond by March 16

The attempt to see judicial review of George Osborne’s buy to let tax change continues apace, with the government now having just over two weeks to respond to the latest correspondence.

Letting Agent Today readers will be aware that landlords Steve Bolton and Chris Cooper are arguing for a review of section 24 of the Finance (No. 2) Act 2015 - which includes the proposed restriction of mortgage interest tax relief at a basic rate, even for higher rate-paying landlords.

The latest position is that having filed the formal application to mount the legal challenge and seek the review - signed off by Cherie Blair - both HMRC and the Treasury have until March 16 to respond with what is called an ‘Acknowledgement of Service’. 

This sets out the grounds on which the departments intend to contest the application.

A statement from the landlords, posted on Facebook, says: “We expect the government to respond aggressively.”

The government also has what is known as ‘a duty of candour’, which means that it must be forthcoming with information that might assist the court to understand the government’s decision-making processes and deal with the issues fairly. The landlords have made a series of requests for information in this regard, which they say have not yet been given a response. 

You can read the landlords’ full update here. 

In it they conclude: “We are hoping for a positive result but are mindful both that judicial review proceedings are inherently difficult and also that, even if we win, the government might introduce changes or new measures that are more defensible legally but still unattractive and problematic for hard-working private landlords.”