Covid-19 Bounce Back loans for property businesses

by Ranjan Bhattacharya

16:06 PM, 5th May 2020
About 5 months ago

Covid-19 Bounce Back loans for property businesses

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Covid-19 Bounce Back loans for property businesses

The Bounce Back Loan Scheme (BBLS) applies to buy to let landlords! In this video Andrew Roberts and I take a look at the eligibility criteria and how you can apply for up to £50,000 as an interest free loan for your buy to let property rental business.

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Covid-19 – Corona Virus Bounce Back Loan Scheme (BBLS) For Property businesses buy-to-let Landlords


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Comments

Beaver

10:21 AM, 6th May 2020
About 5 months ago

Reply to the comment left by Paul Shears at 06/05/2020 - 09:53
I hope you're right. I'm keen to hear more. 🙂

Robert Mellors

10:40 AM, 6th May 2020
About 5 months ago

Reply to the comment left by Paul Shears at 06/05/2020 - 10:10
Perhaps any income resulting from increased equity or increased value of the property is the income from investment? and the rental income you receive from the day to day work of managing the property and managing the tenants in the trading income? Renting property is not passive income, it requires lots of time and hard work from the property owner or manager.

Trevormlazenbury@aol.co.uk

10:41 AM, 6th May 2020
About 5 months ago

I have not watched the video clip, but my understanding is the same as Phil Ashford's comments. That in order to claim the bounce back loan, which is calculated as 25% of turnover in 31.12.2019 , capped at £50,000 ,50% of the income needs to come from trading income.

NewYorkie

10:44 AM, 6th May 2020
About 5 months ago

Reply to the comment left by Caring Landlord at 06/05/2020 - 10:15
Many BTL landlords are having difficulties during lock-down, and many are doing their best to support their tenants. But I am also seeing a number eyeing this as an opportunity for profiteering at taxpayers' expense. Yesterday, one asked if he could get £50000 for each of his 7 property businesses... and use it as an interest-free loan to fund deposits during year 1! Nice, eh? Why 7, I have to ask, unless you are trying to game the system? I suspect his question answers mine!

As to whether BTL is a trading business. Well, if you are Ltd, HMRC expects its money if you 'trade' during the tax year. It doesn't ask what you are trading in. Therefore, the same should apply if you are not Ltd. I won't be applying.

Paul Shears

10:51 AM, 6th May 2020
About 5 months ago

Reply to the comment left by LVW4 at 06/05/2020 - 10:44Or recycle it back into the public sector as council tax on properties that cannot be rented as a result of Covid19.

Beaver

10:52 AM, 6th May 2020
About 5 months ago

Reply to the comment left by at 06/05/2020 - 10:41
So for a BTL business, is this loan going to be based on turnover or profit?

Phil Ashford

10:53 AM, 6th May 2020
About 5 months ago

Reply to the comment left by LVW4 at 06/05/2020 - 10:44
It asks on the CT600 for your Trading Income (Schedule DI Income). It asks for your investment income (Schedule DIII). It asks for your property income (Schedule A). So a company submits a Corporation Tax Return that splits out all of these forms of income - Only Schedule DI is Trading Activity... so many many pieces of Case Law on this.

Phil Ashford

10:56 AM, 6th May 2020
About 5 months ago

Reply to the comment left by Robert Mellors at 06/05/2020 - 10:40
Robert - By that argument, you are arguing that private landlords should pay National Insurance on their rental profits... but as we all know, they don’t. Why? Because they are not Trading Profits...

Have the loan if you like, but start paying an extra 8% in tax, if landlords wish to argue that they are Trading. Hanging yourself with your own argument.

Robert Mellors

11:07 AM, 6th May 2020
About 5 months ago

Reply to the comment left by Phil Ashford at 06/05/2020 - 10:56
Hi Phil

I'm not stating that this is the case, I did use the word "perhaps" and questions marks, so I was clearly raising it as a question (based on a potential possibility).
As for landlords paying more tax, they already pay tax on their income, on capital gains, and even on losses (potential outcome of s24 tax), so I'm not sure they can reasonably pay another 8%, but as we all know, the Government is not reasonable so who knows what other taxes they may wish to introduce.

Caring Landlord

11:23 AM, 6th May 2020
About 5 months ago

Reply to the comment left by LVW4 at 06/05/2020 - 10:44
Personally I don’t have any moral qualms or issues. Policy is now based modern monetary theory and the Old Lady has a forest of money trees!

The issue is simply that the business of being a landlord is the collection of rent business. This is defined as an investment business. Such businesses are not eligible.

If they were eligible I would certainly be tapping away on online applications rather than here!

That being a landlord can be hard and thankless work does not change the legal definition (perhaps unfairly!).

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