Registered with
Property118.com
Monday 17th January 2011
Total Number of Property118
Comments:
11858
Bio
UK landlord since 1989.
Wedded to property, finance, tax and law since 1987.
Enjoying financial freedom since 2003 and location independence since 2016.
Homes in Malta, Florida and Central Russia but very much British with a UK property rental and development business.
Founder of Property118.com - “facilitating the sharing of best practice among UK landlords and associated professionals”
Happy to be interviewed on your Podcast, in Clubhouse, your YouTube channel and other online events.
My speciality is landlord tax planning and I head a team of 10 specialist Tax Consultants and four Tax Barristers. We are recruiting to meet demand.
I don’t offer mentoring or training as I am semi retired and enjoying a fantastic work/life balance, but I do comment frequently and answer questions posted here on Property118.
21:48 PM, 26th July 2024, About 3 hours ago
The linked article from a competing form below is well worth reading. The only issue I have with it is that HMRC has not been giving non-statutory clearances on s162 landlord incorporations since 2018. Prior to that we assisted several landlord to obtain them.
Aside from that it’s a good article and the process is explained in a very simple and logical format.
https://forbesdawson.co.uk/articles/2024/07/26/whats-so-bad-about-bridging-loans-in-a-section-162-incorporation/... Read More
11:01 AM, 25th July 2024, About 2 days ago
PS - the remortgage funds would have gone straight into the conveyancing solicitors client account and then been used to immediately redeem the previous mortgage on the same day, so no difference there either!... Read More
10:22 AM, 25th July 2024, About 2 days ago
Interesting revelations …
I have just read some intellectual debates between highly respected advisers on Social Media about alternative steps that have been recommended and which several landlord clients have implemented, as follows;
1) refinance of all properties to the likes of Paragon Bank, Kent Reliance, Interbay and other lenders who do allow novation, to withdraw their positive capital account balances prior to incorporation,
2) novate those mortgages with those lenders at the point of incorporation with a legitimate expectation that ESC/D32 and TCGA92/s162 will apply,
3) introduce cash taken as drawings (before incorporation) into the company (post incorporation) as shareholder(s) or director(s) loans
4) the company paying down those mortgages.
The key question being asked is; save for the costs of the above arrangement (including the potential of Early Repayment Charges to pay down mortgages) how is the above any different from an unincorporated business using bridging finance to achieve an identical outcome?
I have not seen any comments from Dan Neidle on this point yet, but I suspect it is only a matter of time.... Read More
16:10 PM, 24th July 2024, About 2 days ago
Reply to the comment left by Bemused at 24/07/2024 - 16:00
You are exactly right, but HMRC appears to be attempting to move the goalposts and have the CGT paid up-front at incorporation, even though no cash is changing hands, it's simply morphing from equity in property to shares in the property company acquiring the business with exactly the same ultimate beneficial owners.... Read More
15:53 PM, 24th July 2024, About 2 days ago
Reply to the comment left by Bemused at 24/07/2024 - 15:48
Correct... Read More
15:46 PM, 24th July 2024, About 2 days ago
Reply to the comment left by Seething Landlord at 24/07/2024 - 15:29
Corrected version...
1: incorporation relief to roll capital gains into shares
2: relief from SDLT (HMRC has not disputed this)
3: financing the withdraw of positive capital account balances in the business prior to incorporation and then lending that money back to the Company after incorporation as shareholders or director's loans... Read More
15:06 PM, 24th July 2024, About 2 days ago
Reply to the comment left by Reluctant Landlord at 24/07/2024 - 14:37
DN gave his description of how he believes incorporation should be done correctly on his own website, so he clearly believes it can be done and that there are reliefs available in the right circumstances.
However, this is where it gets technical.
DN's suggested method of incorporation involves the company taking on new mortgages to give the cash to the individual owners to repay any old mortgages.
This goes against established expert guidance in the Lexis Nexis textbooks, which suggest that incorporation using the methods advocated by Dan Neidle risk a concessionary tax relief being disallowed.
After learning that HMRC had issued DOTAS Notices to Property118 back in February this year the Chartered Institute of Taxation wrote to HMRC to seek clarification of the applications of the concession ESC D32 and their manual BIM45700.
HMRC seems to be backtracking on established expert guidance and reasonable expectations. All logical evidence point to the uproar in the industry caused by DN's sensationalist articles attacking Property118.
Technically, Property118 never provided any advice because any recommendations were all checked and, if agreed with, adopted by a regulated barrister's chambers.
The reason that Property118 is fighting is twofold; 1) to help our clients avoid tax demands they were not expecting plus interest and penalties and 2) to vindicate ourselves.... Read More
16:54 PM, 23rd July 2024, About 3 days ago
Reply to the comment left by Blodwyn at 23/07/2024 - 16:40
We have already done that, but Ranjan might want to file a complaint too.... Read More
11:00 AM, 23rd July 2024, About 4 days ago
Reply to the comment left by JB at 23/07/2024 - 09:56
I think it is obvious to any reasonable person that the epicentre of the undue influence on HMRC stems from one person and has grown legs through Social Media comments from those who benefit most from twisted narratives to suit their commercial or ideological perspectives..... Read More
9:30 AM, 23rd July 2024, About 4 days ago
A search on Google for the phrase Capital Account Restructure provides a link to a PDF on the croner-i website as follows ...
https://www.property118.com/wp-content/uploads/2024/07/Withdrawing-capital-from-the-business.pdf
Simon's Taxes, published by Lexis Nexis, which is regarded by the tax and law sector as the leading expert guidance says ...
"The incorporation of a buy-to-let property business may involve refinancing the existing mortgages which could possibly prevent HMRC applying ESC/D32. If the company does not assume the same liabilities of the transferor, but instead raises finance of its own, which is passed to the transferor to settle its debts related to the properties being transferred, there is considerable risk that HMRC might choose not to apply its concession."
AND ...
"If there is a substantial capital account in the unincorporated business, the business owner(s) should be advised to draw this down before incorporation, otherwise that capital will be locked into the value of the shares."
The Chartered Institute of Taxation wrote to HMRC on 28th February 2024 to remind them of the history of ESC/D32 and to question uncertainties following the investigation into Property118. HMRC has yet to respond. A link to the CIOT letter is below.
https://www.property118.com/wp-content/uploads/2024/07/Uncertainties-in-relation-to-the-application-of-ESC-D32.pdf
Dan Neidle and his band of not so merry men all say that nobody in the tax sector agrees with Property118. The above proves otherwise.
On one of his LinkedIn post, Mr Neidle also advised me to take a look around the room to see what others were saying. I did exactly that and came to the very similar conclusions to Ranjan.... Read More
19:54 PM, 22nd July 2024, About 4 days ago
Reply to the comment left by Edwin Cowper at 22/07/2024 - 19:34
As a lawyer you should know that transitioning to a new company will not help anybody, especially our clients.
If you are happy to draft a letter to MP’s and share it here thats fine by me.
Please also confirm whether you are SRA or BSB regulated.... Read More
23:16 PM, 11th July 2024, About 2 weeks ago
Also have a look at Tomar which was built by the Knights Templars after they got kicked out of Malta. That was also a serious contender for us and the prices are around half of the Algarve so you get a lot more property for your money.
We settled on Lagos because we have so many friends here and we wanted to be closer to the sea. We also fell in love with the beaches at Luz and Lagos. It’s also much cooler here in the evenings from the wind off the Atlantic.... Read More
21:16 PM, 11th July 2024, About 2 weeks ago
Reply to the comment left by anthony altman at 11/07/2024 - 21:00
The short version is that both are fantastic Countries but we fancied a change.
Rental yields are far better in Portugal but we have never invested here or in Malta.... Read More
12:43 PM, 11th July 2024, About 2 weeks ago
Reply to the comment left by Louise P at 11/07/2024 - 11:28
PS - I think the idea of forming a subsidiary company in Portugal is well worth further investigation.... Read More
12:42 PM, 11th July 2024, About 2 weeks ago
Reply to the comment left by Louise P at 11/07/2024 - 11:28
Edwina is not an Accountant but she did introduce me to a good one in Lagoa.
I live at Boa Vista so Luz is actually my nearest beach. We go there regularly. I have relatives staying with me until next Wednesday but I’m happy to meet up any evening next Thursday onwards as I’m ’home alone’ whilst my wife is visiting relatives until the end of this month.... Read More
10:47 AM, 11th July 2024, About 2 weeks ago
I can highly recommend a lawyer in Portugal who is Portuguese but also qualified as a Barrister in the UK.
She is fluent in both languages and provides superb levels of communication and services. She even translates all correspondence into both languages side by side.
Many of her clients are UK ex-pats and she also has a superb relationship with all the local banks.
Edwina Shrimpton
email: edwina.shrimpton@gmail.com
Please mention my name if you contact her.... Read More
8:43 AM, 11th July 2024, About 2 weeks ago
Thanks Rupert.
I think it would be far better if Louise was to Post the question herself in that Facebook group. She would then be notified by Facebook of all the answers.
I’m also interested in the answers so hopefully Louise will tag us both, and/or report any feedback here for other Property118 members that may be interested.
If I do get tagged into the Facebook thread I will link to the thread here too.... Read More
8:20 AM, 11th July 2024, About 2 weeks ago
Hi Louise
Both of the answers to your question are yes "in principle".
However, you will need a large deposit, around 50% if you want to avoid the need for life insurance for the Directors/Shareholders to cover the mortgage.
There are plenty of banks to approach, e.g. Millenium Bank. If you are in the Lagos area I can introduce you to the Branch Director of their Premier Banking. I have lived in Lagos, Portugal for just over a year.
There are plenty of Facebook Groups for UK expats in Portugal which I have found particularly helpful.
I've asked my friends Rupert end Elena Chapman to comment on this thread and to post some links to the best Facebook Groups. They have lived here a lot longer than me and are far better connected.
I hope that helps and if you are ever in Lagos I'm happy to meet up for a coffee.... Read More
9:24 AM, 29th June 2024, About 4 weeks ago
You have already been given some excellent advice here and to add to that I suggest that you make a complaint to the Local Government Ombudsman and copy to your tenant, the Council officer who signed the letter, your local MP (and their new replacement post election if necessary).
I recommend your complaint quotes the Homelessness Code of Practice and the statements made at the time my Brandon Lewis PLUS the Reform party.
I’m not sure how far it will get you but it might help to change things moving forwards and make you feel a bit better.
Meanwhile, I concur with the advice of other Members to instruct an eviction specialist immediately.
See >>> https://www.lgo.org.uk/
I hope this helps.... Read More
20:43 PM, 22nd June 2024, About a month ago
Superb video. It really demonstrates the depth of your knowledge. Well done 👏👏👏... Read More