Summer Budget 2015 – Landlords Reactions

Reply to the comment left by "Gareth Wilson" at "27/12/2015 - 22:56":

Further to my previous message, here is a copy and paste of the message I sent via every rental property add on Gumtree for my county. Please feel free to plagiarise.

“Dear Sir/Madam,

Though I am not writing to you regarding your property vacancy, this message concerns a matter likely of even greater importance to yourself.

Clause 24 of the Finance Act 2015-16 is going to transform the profits of many landlords into losses, by drastically multiplying their tax liability. It will do this by calculating their tax bill not merely from their net profit (as is the case right now), but from their deemed profits measured prior to the deduction of mortgage interest (only 20% of the mortgage costs are given back as an allowance/tax relief). Rents will therefore be forced to rise to compensate for the government taxing profits that do not exist.

You can find out in detail how the tax will work on page 1 of the “Budget 2015 – Landlord Reactions” thread of the website Property118. Here you will also be able to download a highly accurate spreadsheet, into which you can input your own job income, rental income and mortgage expenses to calculate precisely how your own personal tax liability will change as a result of Clause 24.

THE GOOD NEWS IS THAT THERE ARE SOME SIMPLE AND HIGHLY EFFECTIVE WAYS TO FIGHT THE IMPOSITION OF THIS GROSSLY UNFAIR TAX MEASURE:

1) Sign the official online petition against Clause 24 and share a link to it on your Facebook page. I am unable to post the URL in this message, but you can easily find it by typing “buy to let petition” into Google.

2) Pledge a donation towards the Crowd-Funded legal action against Clause 24. Again I cannot share the URL via Gumtree but you can easily find the page by typing “clause 24 crowd justice” into Google. Payment will only be collected from your bank account when the campaign’s target is eventually reached. Please share a link to the Crowd-Justice page on your Facebook stream as well.

3) Immediately contact your local MP and make plain the damage Clause 24 will inflict upon your finances and to your tenants. The most effective way to do this, is by arranging a face-to-face meeting at their constituency surgery, during which you can talk your MP through a printout of your resulting finances, taken from the spreadsheet downloaded at Property118 (as mentioned earlier). If for logistical reasons you cannot arrange a face-to-face meeting, please try to support your written correspondence with a copy of these calculated financials.

4) Write to the primary overseers of this change to the tax system, explaining the damage it is destined to inflict. These overseers are George Osborne and David Gauke. I cannot put their e-mail addresses into this message, but you will be able to find them easily using Google or the UK Parliament website.

5) Copy and paste the above instructions into an e-mail and send it to every landlord, letting agent and mortgage broker that you know. At this point you will be able to send URL and e-mail addresses, so please feel free to add them to the above points.

Completing the above tasks is a straightforward and effective procedure, which may further inspire you to a far greater individual contribution to the campaign against Clause 24.

Please help us to help you. Seize the opportunity to act and fight to defend your hard-earned livelihood!”

Reply to the comment left by "Timid Landlord" at "28/12/2015 - 15:40":

If you promise to copy me or do something similar to this I promise I'll tell you what I had for breakfast 🙂

Great idea, Gareth. London alone has got over 20,000 of ads. A good database of landlords. Which areas have you covered? I will join in...Thanks.

Reply to the comment left by "Jen R" at "28/12/2015 - 16:05":

Hi Jen,

I'm afraid I can't say exactly which county I have done, because there are people watching Property118 from a different forum who try to shadow precisely what we do and might cause trouble for certain members if they work out their specific localities.

So my hope is that everyone will cover their own county/London borough and not divulge precisely which one that was 🙂

Besides, a little bit of duplication in some areas may be necessary to focus peoples' attentions.

Reply to the comment left by "Gareth Wilson" at "28/12/2015 - 16:26":

I see. Thanks, Gareth - the reason I asked was to simply avoid duplications:)

Reply to the comment left by "Jen R" at "28/12/2015 - 16:39":

That's ok, preventing duplication was honestly the reason why I thought you were asking.

Thank you for getting involved by the way : )

http://www.ft.com/cms/s/0/f4616058-ad7f-11e5-b955-1a1d298b6250.html#axzz3vdzK2hOy

That's interesting. The treasury is now looking to close loophole that if you buy through company, you will not be exempt from new stamp duty.

In regards to, previous rumour that, if you owned 15 properties in company you will be exempt- This is not the case, as you would need to buy 15 properties in one hit to qualify (Bulk).

So it might be prudent not to incoporate existing portfolio in a company, as I think they will initiate their clampdown on compaines shortly after they finished with individuals.

Reply to the comment left by "Timid Landlord" at "28/12/2015 - 19:12":

Do the FT quote their source? The 15 properties issue is not a loophole or a rumour but a matter to be the subject of consultation according to the Chancellor's announcement. The following is what appears on the Government website and consultation has not yet started:

"SDLT: additional properties
Higher rates of SDLT will be charged on purchases of additional residential properties (above £40,000), such as buy to let properties and second homes, from 1 April 2016.

The higher rates will be 3 percentage points above the current SDLT rates. The higher rates will not apply to purchases of caravans, mobile homes or houseboats, or to corporates or funds making significant investments in residential property given the role of this investment in supporting the government’s housing agenda.

The government will consult on the policy detail, including on whether an exemption for corporates and funds owning more than 15 residential properties is appropriate.

The government will use some of the additional tax collected to provide £60 million for communities in England where the impact of second homes is particularly acute."

Reply to the comment left by "Seething Landlord" at "28/12/2015 - 19:45":

Does anyone have a link to the consultation? I wasn't aware that it had started.

Reply to the comment left by "Seething Landlord" at "28/12/2015 - 19:45":

Have found the link:
https://www.gov.uk/government/consultations/consultation-on-higher-rates-of-stamp-duty-land-tax-sdlt-on-purchases-of-additional-residential-properties