This week marked the introduction of profound changes to the taxation of buy-to-let investments, leaving landlords scrambling to protect themselves from higher tax bills.

On Thursday buy-to-let investors became unable to offset all their mortgage interest against their profits. Within three years none of the interest will be tax-deductible. The changes mean that many landlords will pay more tax – and in some cases will be taxed on nonexistent profits.

What has changed?

Higher-rate taxpayers can no longer offset all their mortgage interest against rental income before calculating the tax due. This will lead to higher tax bills even if investors have not seen their income increase.

The reduction in relief is being phased in between now and 2020 and will be replaced by a 20pc tax credit. From this week landlords can offset only 75pc of their mortgage interest against their profits. This falls to 50pc next year, 25pc in 2019 and zero in 2020.