Summer Budget 2015 – Landlords Reactions

More on rent controls
http://www.landlordzone.co.uk/landlordzone-update/will-sense-prevail-with-rent-controls#rm

Reply to the comment left by "Trendo " at "28/08/2015 - 13:42":

Interesting article. He was right to talk of a 'witch hunt.' We should adopt that phrase as it certainly describes what's been happening to us for some time. If they introduce rent controls - despite all expert opinion suggesting it's a very bad thing - then I think they'll be finally thrashing landlords into the ground.
Although it does make me want to say: If they want to cap rents they can try and cap mortgage interest rates as well - see how they get on with that. Or is it okay for landlords to face potentially infinite interest rate payments, but tenants' rents can be capped? And they think landlords will stick around for that?
This shit just gets worse all the time. Obviously I'll fight the tax grab to the bitter end, but if we lose the battle, it might be good for me on a personal level. I only got into it by accident and because I'm good with money. It's hardly one's life-long dream to 'become a landlord.' I'll be like someone said on another thread - I'll be skipping through the meadows. I'll have enough money left to live on after this travesty and some other mug can deal with all the hassle and crap involved in being a landlord.

Latest communication from the DPS:

'Thank you for your recent enquiry.
Our next 'Open House' will be issued in mid September to all the registered landlords that hold deposits with us. However, I will double check our mailing list to ensure this is issued to you.

Thank you for your website suggestion, the content of the 'Open House' communication has not yet been finalised, and this has been passed to our Marketing Department for consideration.

If you have any further enquiries, please refer to the "Help" section of our website at http://www.depositprotection.com.

Yours sincerely

Kate Pettitt'

NB. Has anyone on here ever seen this 'Open House' publication from the DPS?

Reply to the comment left by "Dr Monty Drawbridge " at "28/08/2015 - 10:24":

Yes Monty you are correct, it is nonsensical to compare residential LLs with people making a couple of clicks to trade shares from their laptop or smartphone.

The point I was trying to make was that if the govt are trying to compare non-incorporated residential LLs and shares, then commercial premises landlords or their agents are far more hands off. The commercial premises tenant usually does absolutely everything. The tenant often just gets ‘shell & core’ of a building and left to get on with it for the next x years or decades, while paying rent to LL.

As a separate point, I would encourage everyone to make an appointment with their MP in addition to writing letters. Type the MPs name in to google, which will hopefully bring up a link their website in the first few results and follow instructions re making an appointment at one of their surgeries. That said, in my case the phone number was never answered, so I emailed to arrange the appointment.

NLA letter facts and figures

http://www.landlords.org.uk/sites/default/files/Finance%20Bill%202015-16%20-%20Briefing%20-%20August%202015.pdf

Absolutely Ros. I'm out of this game either way, whether this ridiculous tax proposal gets passed or not. I'm sick to death of being cast as a villain. As you said, some other mug can deal with all the nonsense. It's a thankless task and the day when all of the properties are sold couldn't come soon enough.

Reply to the comment left by "Neil Allen" at "28/08/2015 - 15:21":

Yes. Freedom!

Just received the following letter (I had to scan/OCR it) from my MP Andrew Murrison who wrote to HMT on my behalf. The response is essentially what I'd expected i.e. toeing the party line. I shall be demanding a face-to-face meeting asap.

Herewith the full text:

Dear Andrew

Thank you for your letter of 15 July to George Osborne enclosing correspondence from your constituent, Barry Fitzpatrick, about the changes the Government made to the taxation of landlords at the Budget and the Capital Gains Tax (CGT) system. I am replying as Minister responsible for this policy area.
The Government wants a fair tax system. That means ensuring that landlords with the largest incomes no longer receive the most generous tax treatment. By restricting finance cost relief available to the basic rate of income tax (20%) all finance costs incurred by individual landlords will be treated the same by the tax system. This restriction will reduce the advantage landlords may have in the property market. Only around 1 in 5 (18%) of individual landlords are expected to pay more tax as a result of this measure, and this change is being introduced gradually from April 2017 over 4 years. This ensures landlords will have time to adjust and plan for this change.
Landlords will also continue to get full income tax relief on the costs incurred in letting out a property, such as letting agency fees and replacing furniture, as others do on the costs they incur in carrying out a trade.
You note that Mr Fitzpatrick has a portfolio of buy to let properties and seeks a rollover relief to assist moving these properties into a corporate structure. The CGT system already contains a form of rollover relief, known as "incorporation relief', which applies where a person who is not a company transfers a business to a company as a going concern in exchange for shares issued by the company. Further information can be found on the Gov.uk website (www.gov.uk/incorporation-relief), and in HM Revenue and Custom's Help sheet 276 (www.gov.uk/government/publications/incorporation-relief-hs276-self¬assessment-helpsheet).
As is the case now, there are many considerations landlords need to take into account when deciding how to hold their property. Corporate landlords receive finance cost relief at the corporate tax rate, which is currently 20% and will fall to 18% by 2020. Incorporating will involve additional costs and an individual may incur additional tax charges, for example if the individual took profits out of the company.
I do want to reassure you that all areas of tax policy are kept under review at all times and the Government is always interested in hearing ideas for potential tax reforms.
Please pass on my thanks to Mr. Fitzpatrick for taking the trouble to make us aware of these concerns.
Yours ever
David Gauke

The bit about Incorporation Relief is interesting - I wonder how it would work in practice, if the equity in the properties is transferred to a new company, and what the lenders would make of it. Do we have a passing expert who can comment?