Summer Budget 2015 – Landlords Reactions

Summer Budget 2015 – Landlords Reactions

14:00 PM, 8th July 2015, About 7 years ago 9619

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Budget 2015 - Landlords Reactions

The concern is;

Budget proposals to “restrict finance cost relief to individual landlords”Summer Budget 2015 - Landlords Reactions

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Comments

james pearce

21:23 PM, 8th July 2015, About 7 years ago

Mark,
interesting comments. Knew something was amiss when you start to see BTL discussed in the daily mail!!!!!!
I have one sale about to exchange and one purchase. maybe I should abort the purchase and hold on to my cash......................
Traditional BTL areas, flats etc are sure to be quite badly hit in due course and as you say "cash is king"
maybe you should just sell enough to pay all your debts off as that will be more efficient.
the rental market of course isn't going away although it may help a few first timers get on the ladder.

Jay James

21:30 PM, 8th July 2015, About 7 years ago

Reply to the comment left by "Romain Garcin" at "08/07/2015 - 20:33":

Romian, do you mean profit on rental activities or on all activities?

If a rental loss combined with other income makes you a higher rate tax payer, then yes, I see that tax will have to be paid on part of the mortgage interest. (your higher rate % less 20 per cent)

However, if you refer to a loss on all activities, then no, there will be no tax to pay.

Mark Alexander - Founder of Property118 View Profile

21:32 PM, 8th July 2015, About 7 years ago

Reply to the comment left by "james pearce" at "08/07/2015 - 21:23":

What's the point of holding a depreciating asset?

Better to hold if if you have maximised the cheap cash you can get out of it surely, especially if you can at least break even, and then use that cash to swoop into a buying frenzie when values bottom out?
.

Paul Machin

21:34 PM, 8th July 2015, About 7 years ago

Reply to the comment left by "Mark Alexander" at "08/07/2015 - 21:10":

As I see it Mark, The "Buy to Let" Business model is finished with this ridiculous badly worked out tax on our Mortgages.

The chancellor seems to have forgotten the treasury gets tax by way of Capital gains tax when we sell our properties, home owners do not pay tax on their personal residence when they sell.

If the world wide economy crashes and interest rates soars, this tax will wipe Buy to Let investors out.

We are both old enough to remember interest rates at around 13%. I dare not work out what the tax implications on my 30 + Buy to Let loans will be should we have a return to interest rates like that again.

Many take the view that this could not happen again and interest rates will remain low forever. Think again the world is in a very unique and potentially unstable financial position.

What am I going to do? I am looking at the loans that have the highest loan interest payable and will make a judgement in the coming months.

At the moment I am in shock like most of us and cannot believe how badly thought out this is.

Romain Garcin

21:38 PM, 8th July 2015, About 7 years ago

How does HMRC deal with Islamic BTL 'mortgages'?
They don't charge interests, as I understand it, are based on co-ownership and rent payments.

Monty Bodkin

21:40 PM, 8th July 2015, About 7 years ago

Reply to the comment left by "Mark Alexander" at "08/07/2015 - 21:10":

What are your thoughts?

A knife in the back but it won't make much difference.

Slight downward pressure on house prices, slight upward pressure on rents.

A minor blip in the market.

Some will be winners, some will be losers.

Nothing to lose sleep about. Good Night!

Mark Alexander - Founder of Property118 View Profile

21:42 PM, 8th July 2015, About 7 years ago

Reply to the comment left by "Romain Garcin" at "08/07/2015 - 21:38":

Very interesting!

However, I'm sure the Sharia mortgage providers will be reeling at this news too because they do use debt to underpin what they do, even though they "re-badge" interest for the benefit of their Islamic borrowers.
.

james pearce

21:48 PM, 8th July 2015, About 7 years ago

What’s the point of holding a depreciating asset?
True enough I suppose, there will be bargains to be had thats for sure.
I suspect yet again it will be flats etc that will be hardest hit.
Interesting times, nothing quite like a bit of bargain hunting.........
Going to take a while to formulate thoughts and digest just how things might go.

Jay James

21:57 PM, 8th July 2015, About 7 years ago

Reply to the comment left by "Mark Alexander" at "08/07/2015 - 21:42":

I had Sharia financing briefly explained to me siome time ago. Much of it is now forgotten, but I remember that essentially it is based on charging and receiving interest. I suspect they will be similarly hit by the changes to interest relief, as are other BTL borrowers.

Shakeel Ahmad

22:00 PM, 8th July 2015, About 7 years ago

This is all confusing. Can one of the learned members set out the position in the scenario below.

he propery owner is a basic tax rate payer.

Before the election

Rental income 40,000
Intreest -20000
rates etc -1000
Service charges - 6000
Surplus 13000 tax on surplus @20% £ 2600

a) What will be the position as at today on the above position.?
b) what is the position if the Landlord is a higher tax payer ?
c) Where the lower tax threshold is crossed ?

Thanks in advance

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