Keeping the momentum going against Section 24

Keeping the momentum going against Section 24

9:29 AM, 13th December 2016, About 6 years ago 61

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I have decided to adopt a policy of making myself a complete pain in the backside and try to create as much noise around this subject as possible. Not sure it will work but it’s better than sitting around waiting for the inevitable.momentum

I have written to my local MP Caroline Dineage and have received the following response. I was wondering if anybody, who knows more about the subject than I do, could help me to fashion my next response to what I consider to be a bog standard misinformed piece of nonsense. I would like to go back with as much fact as possible to argue against each of her points. I can do the research and thinking on my own but 10,000 heads are better than one and wondered if anybody had any ideas or information that dispels the figures/information she is quoting?

I have also written to each member of the select committee on housing which met last week and will be responding to what I strongly suspect will be a very similar email reply from each of them:

“Thank you for your e-mail. I am very sorry for my error in sending a response to you regarding letting agent fees rather than mortgage interest relief. I have been receiving a great deal of correspondence on these two issues and inadvertently confused your e-mail with another.

As a former business-owner myself, I am passionate about helping small businesses thrive and fully appreciate your concerns about this policy proposal for the viability of your business.

The reason for these reforms is that the Government feels that the interests of the professional rented sector need to be balanced against the wider interests of the economy, including home ownership rates, a fairer tax system and mitigating against any future risks.

The current tax system supports landlords over and above ordinary homeowners, with tax relief particularly benefiting wealthier landlords with larger incomes. Every £1 of finance cost they incur allows them to pay 40p or 45p less tax.

The Changes to Mortgage Interest Relief do not tax landlords on turnover as opposed to profit. Rather, they remove mortgage interest from what is qualified as ‘allowable expenses’. I think it is important to note that maintenance and repairs, along with agents’ fees, legal fees, insurance, utilities, and service charges, are all still ‘allowable expenses’ and thus still tax deductible.

I appreciate you feel this could cause many private rental businesses to fold, but I would stress that less than 1 in 5 individual landlords are expected to pay more tax as a result of the restriction to Mortgage Tax Relief. Furthermore, I would assure you that this change is being introduced gradually from April 2017 over 4 years, giving landlords time to plan for and adjust to these changes.

While I appreciate you might find this response disappointing, I hope it goes some way to explaining the Government rationale on this issue.

Thank you once again for taking the time to write to me on this important issue.

Kind regards

Any guidance, info, statistics, quotes, etc. to make it harder to argue against us would be very much appreciated.




Gary Dully

15:06 PM, 13th December 2016, About 6 years ago

Dear Ms Dineage,

I have read your response and it becomes apparent within seconds that you assume that the government has put some thought into this and it won't affect your constituents and other businesses.

So I'm going to tell you 2 things, that your friends probably wouldn't, but your best Friend would.

1. You are insulting my intelligence
2. You are about to allow an absolute tragedy unfold for millions of households in the U.K.,who quite frankly deserve better from a politician of any political persuasion.

Whoever you are listening to is either an idiot, can't do simple mathematics or doesn't "Get It"!

To be perfectly honest with you, you need to stop coming out with this government inspired "clap trap" and use a spreadsheet, just like thousands of accountants are currently doing and instructing their individual BTL landlord clients to do the following to survive this crass stupidity from an apparent 'Conservative' government.

Remember when Gordon Brown eradicated "Boom and Bust"?

Well George Osborne has decided to go one better and defy the natural laws of accounting and how real businesses work, and decided to mix matter, (Taxable income), with anti-matter, (Allowable Business Expenses), to eradicate all BTL landlords in a big explosion.

That's right he's combining the two particles of physics together and expects only a 1 in 5 chance of a black hole opening up in the housing market as the BTL property pool vanishes and what's left will be sucked up by corporates or rich cash buyers at a bargain.

It's funny that accounting laws that don't exist from April 6th, 2017 for individuals that are landlords, but will still exist for corporate housing providers.

Why is that I wonder?

Accountants are advising their BTL clients to do the following.

1. Raise Rents by up to 180% per year for old tenancy agreements.
2. Evict all Social Benefit Claimants, regardless of any plea by the Local Authority to help house the vulnerable.
3. Sell up and leave the BTL market altogether
4. Declare Insolvency if as a landlord you currently only 'break even'
5. Incorporate all future purchases in an attempt to make you on a level playing field with corporate suppliers of housing.

This Happening Right Now

Stop and for once in your life listen to what you are being told by landlords, who are not idiots! and compare it to the actual reality.

This is not a hysterical response, by landlords, it is a requirement to avoid bankruptcy by the HMRC, within 4 years.

Already the banks have had their "Light bulb" moment and have seen what carnage is about to unfold and are advising landlords with warning pamphlets and letters.

Have you read any of them? - if not, I suggest that you do so.

Supposing that in your previous business that the government set up your tax rules that blatantly made you as a competitor to any limited company totally unviable?

What if the new regime brought in a penal tax rate for your business, even if it makes a financial loss?

What if you were told that the major loans of your business were no longer going to be classed as a business expense, but instead were classed as "Taxable" income and a paltry 20% allowance would be granted against a 100% cost.
How long would your previous business have survived?

Most BTL landlords businesses today will become unviable by the 6th April,2017,followed each year by a fresh batch.

This nonsense that only 1 in 5 will be affected is absolutely absurd.

Any Landlord that has borrowed money for a house will be passing the additional tax onto their tenant. They have no choice,they are a business not a charity.

Those that can't will simply go bust or QUIT!

Do you have a million replacement landlords hidden somewhere?

Do you have a million replies ready as hundreds of thousands of benefit claimants are evicted wholesale on to the streets as the private rental market implodes?

If you think you have a housing crisis today, what makes you think it's going to improve, as HMRC applies tax rates on a turnover to a bank, (currently an expense with a 100% tax relief) and changes it to another class of income with a tax relief of just 20%?

Are you prepared to see your constituents pay my tax rate of 40% on the remaining 80%?

Landlords dont pay any income tax, their tenants do!
They pay for my holidays, my toilet paper, my car, my pension, my lunch and my bicycle tyres.

All additional costs will come from rent.

Do you think interest rates will rise?, so will the additional tax but by exponential amounts.

Stop, Think and Listen for Gods Sake!

The damage is already picking up at a steady pace, you have limited time to save the private sector rental market.

Grumpy Doug

15:43 PM, 13th December 2016, About 6 years ago

Hi Pam. As the others have all said, well done ... I think I must fill half of my MP's email!

You may want to remind Ms Dineage of Pareto Law, otherwise the 80/20 rule. It exists everywhere in life - great picture is the iceberg in this post

Politicians exist in their Westminster bubble and sometimes they need something like this stuck in front of them to realise the unintended consequences of their actions.

PS - great post Gary. Mind if I steal some to send to my MP. He hasn't heard from me for a week or so!

Simon Griffith

17:26 PM, 13th December 2016, About 6 years ago

Inspired by Pam to email my MP again...
• Please could I have the courtesy of a reply to the question in my email of 2 December 2016 ?

• The measures introduced by your government in attacking the Private Rented Sector have made our business unsustainable in it’s current format.

You want us to sell our properties to First Time Buyers – in order to do this we will have to evict the existing tenant. When we evict the tenant have you any advice on what we should tell them ?

They will hitherto have been happy in the property, working hard (indeed many are those JAMS you MPs are so disingenuously claiming to want to help) and paying the rent. You want me to kick them out so they can move over for a First Time Buyer - what should I say to them ? Where can they go ?

PS If you are at all interested Dame Kate Barker has recently produced an impartial report for the Treasury Select Committee – another well informed professional warning of the impending doom.

Jennifer Aniston

17:29 PM, 13th December 2016, About 6 years ago

Perhaps they could also advise those first time buyers how they can save a minimum 20% deposit that is required by the mortgage companies? If my son wanted to by his flat he would need to save £50k min. He's a plumber, he'd be nearly retired by then (not forgetting the property price would have gone up).

Ho Hum


Gary Dully

20:15 PM, 13th December 2016, About 6 years ago

Reply to the comment left by "Grumpy Doug" at "13/12/2016 - 15:43":

Feel free Grumpy, but don't be polite about it.

Ask your tenants if you can send some pictures of them to your MP asking them to comment on the real people that are facing eviction or massive rent increases.

Jennifer Aniston

20:41 PM, 13th December 2016, About 6 years ago

I will be devoting plenty of time tomorrow to composing a variety of informed responses to Caroline Dineage. I have received yet another response from her today which, as it was exactly the same as yesterday's, serves no other purpose than to show the other recipients that she had responded. So, the lesson? Any emails sent to your constituency MP should be copied to the Chancellor and the Treasury Select Committee for Housing. And Theresa May if we want a response.

In the meantime, please check out my online campaign and let me know why you think.

Please pass on to your fellow landlords and effected tenants.


Chris @ Possession Friend

21:35 PM, 13th December 2016, About 6 years ago

The Government, backing Ozzy's pernicious plan are so full of S**t that even their own supporters ( many Landlords ) can't stand the smell.
I had the following response from my MP, Gareth Johnson, Dartford -
That as the bill had been passed, there was nothing further he could do ( despite me writing to him about 6 months ago, and he pointed out that the case was taken to the High court and the Govt won. !
The whole Government ' spin ' on their Housing policy is flawed, including their belief that Buy to Let is reducing Home ownership - Rubbished recently in the Redfern review, and also the government will charge to the tenants rescue by building new homes [ no doubt funded by their increased tax levy on robbing Landlords ] has been, - According to new joint research from the Federation of Master Builders and the Local Government Information Unit, almost 90% of local authorities believe that the Government’s housing targets will be impossible to meet due to a lack of planning resources.

Jennifer Aniston

7:55 AM, 14th December 2016, About 6 years ago

So we now have another name to add to our email strategy - Jane Ellison, Financial Secretary to the Treasury. Well, she'll be hearing from me shortly. Email address: if anybody else fancies joining in.

A more personal response from Caroline this time, at least, and she's asked me to reply which is a good sign. Still get the standard government BS though. But now I've got to sit and do some maths and pull together a forecast of how this is going to specifically impact me. Which I haven't done so far I will admit. It's all been a bit 'back of a fag packet' so far. Aaargh!!! I'm probably going to have to see my accountant first so that I can respond accurately.

In the meantime, here's her response:

"Thank you for writing to me about changes to the taxation of landlords.

I appreciate your concerns and am very sorry to hear that these changes are likely to make your business financially unviable. I am passionate about helping small businesses thrive and promoting a robust professional rented sector. The supply of housing is of course hugely important, and the counselling service you operate at Gosport Medical Centre sounds like a community asset that it would be damaging to lose. If you could provide a detailed breakdown of how section 24 is going to affect your business I would be very happy to request that the Financial Secretary to the Treasury, Jane Ellison, respond to the issues raised.

It is my understanding that Section 24 will only result in 1 in 5 landlords paying more tax. The Government, however, recognises that those landlords who are affected will face some difficult decisions, which is why the change is being adopted proportionately and gradually. Basic rate income tax relief will still be available on a landlord’s finance costs, the restriction will not be introduced until April 2017, and it will be phased in over 4 years. Landlords will therefore have time to plan ahead. The changes to Mortgage Interest Relief do not tax landlords on turnover as opposed to profit. Rather, they remove mortgage interest from what is qualified as 'allowable expenses'. Maintenance and repairs (along with agents' fees, legal fees, insurance, utilities, and service charges) are all still 'allowable expenses' and thus still tax deductible.

I appreciate the Government’s rationale behind section 24. These changes have been introduced because the current tax system supports landlords over and above ordinary homeowners, with tax relief particularly benefitting wealthier landlords with larger incomes. Every £1 of finance cost they incur allows them to pay 40p or 45p less tax. Income tax relief for finance costs is not available to ordinary homebuyers. Nor is it available to those investing in other assets, such as shares. Section 24 is therefore part of the Government’s commitment to delivering a fairer tax system.

However, please do let me know the specific financial implications for you, and I would be happy to raise your case with the Treasury".

Thank you again for taking the time to write to me.

Kind regards,


Keep up the good work everyone and just a reminder of the email addresses of the Treasury Select Committee on housing:

The Chancellor:

She who must be obeyed:

Of course you can all add your own constituency MP's. I honestly think I only got a personal response from mine because I copied in the Chancellor. He'll probably never get to see it but is it a chance Caroline is prepared to take? Clearly not.

Good luck everyone. Keep on moaning!


Chris @ Possession Friend

8:24 AM, 14th December 2016, About 6 years ago

I think a succinct but carefully worded letter should be composed for All Landlords to send to their tenants, either now, or shortly before rents increase, - making Tenants aware of the financial implications to THEM, of Sec 24.
The letter needs to be worded to get them on 'Our' side - Then lets get it out there in all the industry magazines

Landlords are woefully short of supporters at the moment, hence my previous suggestion that we need a Publicity / Media relations manager.
I believe that the image of Landlords is pretty bad, leaving ourselves open to the wolves ( Shelter, Generation Rent, and others which make us easy prey for any back-benchers to support measures without rigorous argument [ Retaliatory Eviction ] )

Jennifer Aniston

8:39 AM, 14th December 2016, About 6 years ago

Reply to the comment left by "Chris Daniel" at "14/12/2016 - 08:24":

I completely agree Chris,

I have set up a campaign on to try to get the focus on the impact of Section 24 onto the tenants rather than the landlords. Forty five signatures so far (only started it yesterday) am a bit disappointed to be honest but I am hoping it gains momentum so that I can start leveraging it and getting some PR energy around it. I've been tweeting and emailing it to industry people yesterday and today, e.g. conveyancing solicitors, letting agencies, estate agents, mortgage brokers, etc. I've tweeted it to my MP, Philip Hammond and Theresa May so I hope it doesn't turn out to be a damp squib. Unfortunately, I don't think there is the risk that a lot of tenants won't want to think about it until the notice to quit letter plops onto the mat and, of course, at that point it's too late.

I have send the link to all of my tenants and spoken to many of them and those that have computers have promised to sign.

However, when I posted the link onto my Facebook page the response wasn't great and I spent much of last night arguing the toss with some ex-school friend about how small private sector landlords are the work of the devil and everything from cancer to Donald Trump's election victory is apparently our fault. We've got a lot of negative perceptions to fight against but it can be done. And I think you're right, we need to get the tenants on board.

Here is the link:

Please sign, pass it on to your tenants and fellow landlords. If we can get enough signatures they can't ignore them. The politicians do watch these campaigns and are impacted by them.


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