Summer Budget 2015 – Landlords Reactions

I will submit Question #2 as revised by BTL IS in the next few minutes.

Q1 now submitted

Just finished a meeting with Michael Fallon MP. I am seeing all MPs in who’s constituency I have a property/ “business” .

He said I was the third landlord he had heard from .

I would say he was broadly sympathetic to the idea of distinguishing professional landlords for whom this is the only source of income and are genuine sole traders from those who have cash to invest and purchase a buy to let as a hobby.

He also acknowledged that to make clause 24 retrospective seems unfair.

He kind of said so what if you don’t get any income – you will get capital gains . I explained that this was my only source of income and I need to eat and pay for mortgages and repairs whilst waiting for capital growth / gains upon which I will pay CGT.

He was stuck on the point that reducing the relief to 20% treats all landlords the same so why is that unfair ? I did my best to explain , but not sure if I did a brilliant job. if anyone could rebut this point succinctly I will forward it to him .

Reply to the comment left by “Charmaine ******” at “05/09/2015 – 11:49“:

Charmaine, Michael Fallon is also my MP although my rental property is not in his constituency. I have had cause to approach him on several matters in the past some related to Private rental others concerning the NHS. As a result of my approaches nothing has been done, just placebo responses from government departments.

Reply to the comment left by “David Price” at “05/09/2015 – 12:42“:

I’ve never had much to do with MPs over the years. I have no respect for people who toe a party line and don’t make decisions based on their own personal beliefs. In this case, there seems to be a lot of repeating of nonsense – ‘blackwhiting’ in Orwellian language. I think psychologically it might be worth suggesting to these MPs that they should think for themselves on this and aim to use their influence to show GO that he is going to make a big mistake – which will only be realised when landlords start raising rents and evicting tenants. Do they want to be ‘yes men and women’? And will GO thank them for it further down the line? They might like the idea of standing out as people who speak their mind? If my MP was Conservative that’s the kind of message I would try and include in my emails. An appeal to independent thought and reason.

Reply to the comment left by “Barry Fitzpatrick” at “04/09/2015 – 18:45“:

You do not have to include broken down costs on your tax return if you have <= 6 properties. So HMRC have no way of knowing what proportion of expenses is mortgage interest for smaller landlords.

@Charmaine

The only reason mortgage tax relief is at 40/45% is because the rental profits are also being taxed at this level. So £1 extra of ANY expense means £1 less profit and therefore 40/45p less tax to pay i.e. tax relief of 40/45%.

If the rental profits where tax separately from a person other income at a rate of 20% (as incorporated Landlords do), then there would only “tax relief” of 20p for each £1, as is the case for basic rate taxpayers.

Do we have a volunteer to submit an FoI request for Q3 & Q4?

It only takes 2minutes!!

Reply to the comment left by “Kathy Evans” at “05/09/2015 – 13:08“:

Sorry. I meant broken down by property. So no way to know which properties are heavily leveraged and which are debt-free.

Reply to the comment left by “Charmaine ******” at “05/09/2015 – 11:49“:

And you may never get capital gains (and if you do you;’ll pay tax on them when they happen). Currently all I’ve seen are capital losses because of the all in house prices outside London and the SE. I may die before I see a capital gain. If I invest in shares, I don’t pay tax on hypothetical future gains (for those who think it is just an investment).