Shadow Chancellor John McDonnell anti Buy to Let but said very little

Reply to the comment left by "James dengel" at "30/09/2015 - 13:55":

Sadly you're right but I don't want to give up banging my drum about us landlords still have to collectively & religiously do all we can to stand our ground & fight our corner. We're under threat without the Labour party even coming to power & even worse, we could possibly face a Jeremy Corbyn led Labour party. With rising taxation from the loss of 10% W&T Allowance & in the knowledge that interest rates will start to rise only worsening the impact of the planned restricted tax relief on mortgage interest payments, we will find some landlords being motivated/forced to sell that could create the housing market to totally distabilize resulting in lenders yet again tightening their lending policies/criteria & downwards we go. If this happens it will be worse than experienced in 2008. So we may be fewer in number compared to tenants but we impact on the economy far greater & that's why we can make our voices heard if we really want to but we must get more landlords engaged (& "non" landlord homeowners as their property values will be severely affected as will the opportunity of first time buyers who will find that although property values have dropped which should allow them to buy more easily, they won't be able to raise the necessary mortgage funds due to lenders pulling up the drawbridge). We have great power if we want to collectively exercise it & I don't mean power for power sake or to abuse it. I mean the power to keep the economy stabilized, or not as the case may be.

Reply to the comment left by "Laura Delow" at "30/09/2015 - 18:23":

I am not an Osbourne supporter, but I don't really agree with you. If wider society agrees that the balance between B2L and first time buyers is wrong, then the best policy is via tax. As it is being introduced slowly, then that helps make it fair.

I was very active on the West Brom campaign, but I've not even signed the petition on this one.

Reply to the comment left by "Ed Atkinson" at "03/10/2015 - 12:03":

The best policy is via tax. But the proposals are not a tax they are a restricted credit against a tax charge. "Tax" is a levy made on the product of something be it in cash or kind where it might be called a tithe. The Finance Bill can and will result in some landlords who are cash negative as a result of well structured and intended renovations for the benefit of their tenants still being landed with a tax liabilty; that's just plain wrong as well as being daft.

Reply to the comment left by "money manager" at "03/10/2015 - 13:00":

Yes, any change will produce cases where it is not fair on some losers. But doing nothing can as well. The plight of first time buyers feels unfair to me after the ease with which I entered the housing market decades ago.

Property is recognised as in a grey area between personal accounts and business - hence the Land and Property pages on the Tax Return. This 'greyness' is especially so on loan interest (as the HRMC response letter says, would you want interest on loans to buy shares to be tax-deductible?) Slowly adjusting that relief in a way that targets the better-off seems OK by me.

Reply to the comment left by "Ed Atkinson" at "03/10/2015 - 13:13":

In principle I don't disagree that changing the tax code to raise more tax is without merit. What is without merit is this mis guided attempt to conflate raising revenue and conflating that objectie with somehow levelling the playing field between homebuyers (especilly FTBs) and landlords. Making it less attractive for multiple property owners to acquire through gearing will induce, a raising of rents where possible, displacement of UK dom/resident landlords by foreign basd individuals resulting in the loss of both income and CGT to the Treasury, a lower demand for new property builds of many types as well as squeezed availablity for many of the UK's housing needs. We do not let to families, multiple occupiers, or your typical student popultion. We DO let to foreign students (typically MBA etc) who bring substatial FX to the UK and pay for renowned UK educational services, seconded technicians working on the UK's infrastructure, and weekday executives and professionals with homes elsewhere. Making our life more difficult will not help the intended beneficiaries one iota. What might have helped, and particulalry in and aroud London, would have been moves to curtail foreign BTKE (Buy to Keep Empty) which is purely a banking/security/speculation play and the mass off plan marketing of developments that are never shown to the doemstic market i.e. if you want to buy a new london flat you stand a better chance if you live in HK than if you live in Clapham.
Re that greyness between investment and business there is precedent. The income and capital gains reliefs against other income sources (sideways loss relief) became restricted to those that could demonstarte a level of involvement in "the business". I can't remember the time required but i think it was a few tens f hours a month. Ergo, perhaps a single BTL with full delegated letting and management might be an investment whilst a multiple property portfolio with a high degree of involvmeent might be a business? That latter certainly feels real to me as we move from delegated services to in house.

Reply to the comment left by "money manager" at "03/10/2015 - 14:44":

You make a plausible account for how the changes may have some negative social impacts. A case for other positive ones could also be made. You can't make a change with just positive impacts in this complex world.

From your hours worked principle, you seem to be saying that if an investor went full time in his personal share dealings, he should then be able to borrow money to buy shares and the interest on those loans would then become tax deductible.

Reply to the comment left by "Laura Delow" at "29/09/2015 - 14:17":

Even if JC doesn’t become the next prime minister his rhetoric will influence the future of BTL landlords in a big negative way. I currently have 700k mortgage debt and a portfolio worth 1 million. The betting odds of a JC win are 1-7. I am seriously considering putting a 20k bet on to win 140k (Including stake). This will act as an insurance policy to reduce the chance of personal bankruptcy. The only other alternative is for me is to sell a large chunk of my portfolio now, before a potential JC win in 2020, when house prices crash, as all landlords try to sell at the same time.

Reply to the comment left by "Ed Atkinson" at "03/10/2015 - 15:48":

No, I wouldn't extend tax relief to geared share trading but don't forget that tax relief is already available to those investing in business where they own 5% or more of the share capital. My point was that the principle of diferentiation between passive and active involvement was already recgnised in the tax system. And taking your point about it not being possible to have only positive effects of changes, we have taken advantage of the 10 W&T allowance as it's really a no-brainer. Seeing it's removal but with full relief for actual expenditure is I think a good and practical move as it removes the distorting effect of a potentially over generous relief unrelated to costs incurred. It also makes accounting much simpler which must also be applauded.

Reply to the comment left by "money manager" at "03/10/2015 - 16:10":

Yes, I take your point on the 10% W&T, it is a case of only positive effects of changes

I think we're getting closer as we discuss. I accept that cases of tax relief on the share investment can be OK. What I take is still that this is a grey area and the government can take a view in the public interest. Some will gain and others will lose. I personally am OK with it if the gainers are more likely to be younger and less well off than the losers.