Summer Budget 2015 – Landlords Reactions

Reply to the comment left by "Timid Landlord" at "28/12/2015 - 20:10":

Please ignore my previous comments that were made in ignorance of the fact that the consultation had been published. I have not yet finished reading the document but assume that it is the source used by the FT and will no doubt give rise to further comment here and in the press.

This is very interesting - in this context, 'individual' landlords are deemed to be of equal value to corporates. This Government doesn't know its a*se from its elbow:

https://www.gov.uk/government/consultations/consultation-on-higher-rates-of-stamp-duty-land-tax-sdlt-on-purchases-of-additional-residential-properties/higher-rates-of-stamp-duty-land-tax-sdlt-on-purchases-of-additional-residential-properties#section2

The Autumn Statement indicated the government’s initial view was that any exemption from the higher rates would only apply to corporates and funds (such as companies, and pension and collective investment schemes) who have an existing residential property portfolio of at least 15 properties at the time of a transaction.

Since then, the government has considered that there may be circumstances where significant investment by individual purchasers may positively contribute to development and the government’s housing objectives in the same way as investment by corporate purchasers, and so there may be circumstances in which it is justified to exempt purchases made by individuals from the higher rates.'

Reply to the comment left by "Ros ." at "28/12/2015 - 21:13":

Why is the Government saying that corporate and individuals have the same value when purchasing property but then not when they actually own it?

2.16

So if one flat of an HMO is a knocking shop, the whole lot is treated as commercial, so all are exempt from HR.

Buy 6 at one time and it is exempt from higher rate. Is that one HMO with 6 rooms or s/c flats?

But otoh one person has a cheap flat, gets hitched, rent out, (in case they separate), then later buy an expensive house together, pay very high tax.

Seems to me be easier and fairer to limit LTV, and henceforth tax all profit including capital gain at the marginal rate. Achieves everything.

Quote:
The higher rates of SDLT will only apply to purchases of residential property. The definition of residential property and non-residential property will not change due to the introduction of these higher rates. This means that a purchaser of a non-residential property will never pay the higher rates of SDLT, even if it is later converted into residential property.

Non-residential property includes:

commercial property (such as shops or offices);
agricultural land;
bare land (even where that land may subsequently be used for residential purposes);
forests;
any other land or property which is not used as a residence;
6 or more residential properties bought in a single transaction; and
A mixed use property (one with both residential and non-residential elements).
Mixed use transactions, that is the purchase of residential and non-residential properties together in a single transaction, is currently considered a non-residential transaction for SDLT purposes. The government does not intend to change that treatment.

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

Perhaps the rationale for this is they can make corporates offer a right to buy at a discount, although it's contra to EU law.

Lots more loopholes to be explored by those clever enough, sadly.......

Strikes me an HMO will be chargeable at a higher SDLT rate than the sum of the individuals flats, so even less punters catering for the value end, and ever more costs for LHAs to find expensive emergency accomodation. Oh HPC anarchists, may you be forgiven.

Isn't this a bit silly. What next, sue the government for raising income tax, or VAT?

We elect governments to change our taxes and its up to the public how they choose to react to those changes.

Reply to the comment left by "Ros ." at "28/12/2015 - 21:13":

Ros you say ‘This Government doesn’t know its a*se from its elbow’.

In the case of C24, they have either been (a) incompetent / unaware or they have been (b) deliberately manipulative (for political gain whilst giving their PRS wealthy yet demanding corporate buddies/sponsors a helping hand by proposing to annihilate some of the competition), a question as to which was discussed previously on this thread. Personally I always thought it was a bit of both. Many of you know who my MP is, who may belong to the first category, whilst I suspect his boss GO fits in to the other – being deliberately manipulative.

The terms ‘incompetent’ and particularly ‘deliberately manipulative’ could actually also apply to that other forum which has been described by many as ‘anarchic’. Those guys appeared to fall for GO’s rhetoric. However in addition to slagging members of this this forum off all the time, given that they spend 24-7-365 talking about housing matters including C24 on their own forum albeit from one angle and dominating the comments sections of every housing related news article, it is surely inconceivable that even the simplest souls amongst their forum members do not understand that (1) ONLY a % of residential LLs are being targeted, whilst (2) a larger % of residential LLs WILL indirectly benefit from C24 (those unencumbered, and all ‘corporate’ “borrow-to-letters” from one-man/woman one property bands upwards..)?

So by spending all hours of the day or night supporting C24 and spreading general LL hatred on every media platform available, but NOT even mentioning or discussing the above point they are being as deliberately manipulative as GO.

PS Recently I had more calls, emails and texts from councils desperate for rental property for their desperate HB clients. I guess it must have simply slipped GO’s mind to check council’s housing depts to gauge their views before announcing C24. Or perhaps his corporate buddies instructed him not to do so…

Reply to the comment left by "Mark Shine" at "29/12/2015 - 00:40":

Yes, Mark. Professor Philip Booth - an expert in these matters generally and on C24 in particular - has been willing to be quoted saying GO is either being deliberately dishonest or has been misled/misunderstood it. It is probably a combination of both. Deliberately being dishonest (because that seems to be par for the course for politicians) and a bit thick with it, not being qualified in economics as far as I know. Christ - what is this phenomenon of politics whereby someone unqualified in economics can run the economy? Ditto a lot of the other departments too.

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...unless of course it has "crashed " itself or illuminati have taken down yet another subversive site ?!

Reply to the comment left by "P111 222" at "29/12/2015 - 00:02":

If that was what they we doing Ii wouldn't, believe it or not, have an issue with it but they are not. I have lived through periods of both higher and lower taxation but universally higher than today so it's not the rate per se that's the issue. What IS the issue is the disallowance of a core business cost which affects the viability and effective tax rates of only a small subset of taxpayers, that BTL is a business can be gleaned from the Treasury's own pronouncements despite any personal prejeudicies. This is actually about what it should be, a principle of good governance.