Could the Budget Affect Commercial Property Investment? What Landlords Are Watching

The Autumn Budget is being watched closely by commercial property investors — landlords, funds, and private individuals holding property through companies or personally. The areas of greatest concern are capital gains tax, interest relief, and any changes to the tax treatment of commercial property income.

Capital Gains Tax

CGT on commercial property disposals is currently charged at 24% for higher and additional rate taxpayers (following the 2024 alignment of residential and commercial CGT rates). There is ongoing speculation about a further CGT increase in this Budget, either through a rate rise or a reduction in the annual exempt amount (currently £3,000).

For commercial property investors planning to sell, a CGT increase in the Budget would make pre-Budget disposal more attractive — though this has to be balanced against the cost and timeline of completing a commercial transaction quickly.

For those holding property in a company, the tax treatment is different: profits are subject to Corporation Tax (currently 25% for profits above £250,000) rather than CGT. The relative attractiveness of personal versus corporate ownership depends on individual circumstances and may shift with Budget changes.

Interest deductibility

Commercial property investors holding property personally can deduct mortgage interest against rental income. Those holding through companies retain full interest deductibility (unlike residential landlords, who face restrictions under Section 24). Any change to interest deductibility for commercial property would directly affect the viability of leveraged investment portfolios.

ATED: Annual Tax on Enveloped Dwellings

ATED applies to residential properties held in companies above certain value thresholds and is not directly relevant to commercial property — unless a commercial landlord also holds residential property through the same structure. Budget changes to ATED thresholds or rates can affect mixed-portfolio landlords.

What landlords should consider now

If you hold commercial property and are considering whether to sell, refinance, or restructure your ownership, the Autumn Budget represents a genuine decision point:

• If you are planning to sell, model the CGT position at current rates and at plausible increased rates, and consider whether pre-Budget completion is achievable.
• If you are refinancing, note that interest rates remain high and lenders are pricing commercial property debt at 7–8% or above. The fiscal environment does not suggest rates will fall materially before your next review date.
• If you have vacant space, the current occupier market — with landlord motivation high and occupier choice improving — rewards proactive marketing. RE:match gives landlords and agents direct access to active occupier requirements: businesses that have already described what they need.

Post your available space on RE:match and connect directly with businesses that are actively looking. List your property at rematch.co.uk.