Summer Budget 2015 – Landlords Reactions

Reply to the comment left by “Mark Alexander” at “08/02/2016 – 16:01“:

Inside Out allowed me to see, for the first time, Osborne announcing Clause 24. This made me realise how deceitful the announcement was. He said:

“Buy-to-let landlords have a huge advantage in the market as they can offset their mortgage interest payments against their income, whereas homebuyers cannot”.

The first part is untrue. We cannot offset our mortgage interest payments against our income. Our income is the rental profit. We deduct interest and other costs from our gross receipts in order to calculate the profit, in accordance with generally accepted accounting practice, just like every other enterprise in the country. If we could offset mortgage interest payments against our income we would be deducting them a second time.

Furthermore, if the interest exceeds the gross receipts minus other costs, so that a rental loss results, we still cannot deduct them from our other income – we can only carry them forward to later years.

So Osborne’s claim in the first part of the sentence was deceitful. Even if he believed it was true originally, through ignorance, civil servants in the Treasury and HMRC must surely have educated him.

The second part is not just a false comparison, it is an absurdity. Firstly the homebuyer is not generating any income from the home, so there is nothing to deduct interest from.

Secondly, there is no justification for deducting interest from the owner’s actual income before calculating tax. It was unfair that someone who had a mortgage paid less tax than someone who rented. That is why MIRAS was abolished.

It is profoundly ironic that potential FTB’s who are renting have been duped into complaining, wrongly, that we are getting something which homebuyers no longer get – but which used to give the latter a financial advantage over renters!

Right to rent …5yr prison sentence anyone ???
https://www.urban.co.uk/blog/post/Prison-sentences-proposed-for-non-compliance-with-Right-to-Rent-legislation.aspx

Reply to the comment left by “Appalled Landlord” at “08/02/2016 – 16:36“:

I also saw Cameron nodding his support of an increase in our income tax, having forgotten, or hoping we had forgotten, his solemn pledge of 10 weeks earlier that income tax would not be increased in this Parliament if we re-elected him.

Reply to the comment left by “Appalled Landlord” at “08/02/2016 – 17:10“:

No increase for his incorporated buddies.
Don’t forget he’ll need a job when he ‘retires’ from politics.
What’s the betting him and Gideon get non-exec positions on the boards of the ‘new PRS’ LL in a few years time.
£100k for 1 day a month anyone?

Reply to the comment left by “Worried by Budget ” at “08/02/2016 – 19:04“:

Based on the current level of demonstrated incompetence there is no possibility of Osbourne becoming PM. Just who, or even what party, can credibly form the next government poses an interesting question.

This is why it’s so important to SHARE as much information as possible about the Judicial Review and the campaign against Clause 24:

http://www.whatmortgage.co.uk/news/half-landlords-unaware-buy-let-rule-changes/

Reply to the comment left by “money manager” at “08/02/2016 – 19:12“:

I hope you’re right. But I m afraid that competency isn’t on the job spec for leader of the party or PM though sophistry is.

Agreeing totally MM, it really begs one to believe how incompetence GO is handling the whole thing !

Reply to the comment left by “money manager” at “08/02/2016 – 19:12“:

If only that were true MM. Just look at the track record of the outgoing head of HMRC.
Competence doesn’t seem to be a prerequisite for senior roles I’m afraid.

According to the English Housing Survey, private renting has been growing by 17,500 households per month on average over the 10 years to 2014.

“This analysis demonstrates that we still need to provide a substantial number of homes for rent. Government policy should focus on supporting the development of new homes to rent as well as to buy.”

Instead, Emmett claims recent policy announcements are likely to constrain the supply of rental homes.

The introduction of a three per cent stamp duty surcharge on buy-to-let properties and the restriction on tax relief on mortgage interest payments are likely to limit the ability of private investors to expand their portfolios.
https://www.lettingagenttoday.co.uk/breaking-news/2016/2/private-renting-has-grown-by-17-000-households-a-month-in-england-claim