Capital gains on BTL to be taxed as income

I have just written to the RLA and NLA to see what they think of this. I will post any replies here.

Reply to the comment left by "Mark Alexander" at "26/08/2016 - 12:37":

Sadly, i don't have enough money to transfer my properties to my existing Ltd Co (nothing to do with property), but on the "bright" side, prices up here are still very low so unlikely to make a profit on sales.

Reply to the comment left by "Kathy Evans" at "26/08/2016 - 12:32":

But if they do make being a sole trader BTL investor so onerous that everyone ends up incorporating, it will be the same driven individuals that got themselves to a reasonably successful place when they were unincorporated. Assuming the government's intention is to get rid of us pesky, smaller landlords, it won't work as we'll just be pesky smaller limited company landlords instead (in spite of the financial pain some may have to endure to get to that position) doing pretty much the same as before.

It doesn't change a whole lot in their grand plan of evil scheming and it won't necessarily mean we all throw the towel in, but rather restructure instead. There'll be a few, of course, that sell up and get out, though I would have thought for the most part landlords won't want to just give up on a lifetime's work.

Is there perhaps more evil scheming to come once we've all registered at Companies House...?

Well, it'll be fine either way for those with one or two properties and no much other income (the won't even have to do quarterly reporting under MTD), but even harder work than now for the small, but not that small private landlords.

I've no doubt you've seen the attacks on one and two person Ltd Cos (the ones that HMRC term PSCs), who were forced to incorporate after many of their clients refused to deal with them because of changes in the tax law unless they incorporated. Now, they can't claim business expenses related to travel that a SE person or an employee could. They also risk (as do small unincorporated businesses) being taxed on turnover - aka passthrough taxation/tax simplification - instead of profit.

Without doubt, we are being herded ...

Can't win with the Treasury and HMRC weasels. Perhaps there should be a general judicial review of adverse treatment of very small and micro businesses compared to big ones.

Reply to the comment left by "Kathy Evans" at "26/08/2016 - 12:49":

Where there's a will there's a way Kathy - DESPAIR NOT

My ex-wife pretty much cleared me out of all cash and left me in a position where I was caught in a CGT trap if I stayed in the UK and sold properties to release equity and would face massive financial pressure due to section 24 if I did nothing. The CGT would due would have exceeded the equity and the extra tax on the mortgage interest would have halved my income. I felt stuck between a rock and a hard place. Like you, I looked into incorporation but thee costs were unnafordable, especially as I had a latent gains issue too.

However, by moving to Malta I was able to solve this problem. I sold a few properties to release equity without CGT and now I am in a strong position with real choices. I now have the funds required to pay for incorporation without the CGT headache. I might need to get on with it PDQ though based on this latest news!

Sacrifices had to be made of course but it is all working out well. I was heart broken to have to have my two Tatra Mountain dogs adopted for example. They wouldn't survive the heat in Malta.

You do have choices though, and no doubt you will have sacrifices to make that go with them. Only you can decide which of the consequences of your choices are preferable.

I can visit my dogs whenever I like and I now see more of my family than ever. They love the free holidays. I guess I will just have to learn to live with 300 days of sunshine and living permanently in the Jewel of the Med but hey, we can't have everything can we?

I think a question here to ask is "CUI BONO?"
Who, in reality of the worst case scenario, is going to benefit/profit from such legislation?
Is it - again - for the cronies? (as S24 was - at least partially - aimed to help the richest, mortgage-free landlords).

At the risk of crediting the government with any joined up thinking on housing/tax why would they have sought to differentiate CGT rates on residential buy to lets (28%) and reduce CGT on other assets (20%) at the last budget if this change was planned as being currently interpreted by readers. What would have been the point if this other change was on the horizon. Surely once this is clarified then it may not be as it seems ?

>mark a, see the link I posted earlier: it suggests this legislation is specifically targeted at non residents.

I don't know if the phrase tax haven can be easily used when investing in uk land & property now.

Harsher sdlt, ated, cgt and now this. It is clear the government wants a few bob off anyone looking at making money via uk property & land

Reply to the comment left by "Jon Pipllman" at "26/08/2016 - 14:16":

I think you're reading section 83 and misinterpreting that.

The Law Society are particularly focusing on the wording of sections 75 to 78, that's what this article is all about.

Meanwhile, I'm looking at section 83 myself and trying to get to the bottom of what that means and when it will be implemented. "I'm alright Jack" because my own restructuring is all but completed. What I want to know now is how long I've got to help others.

75 onwards is all about non resident / offshore tax liabilities arising from dealings in uk land

I am happy to be wrong (happens often), but it looks to me as if this is only intended to affect non residents making money from uk land.