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
Caroline”

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

Regards

Pam



Comments

Steve B

10:18 AM, 17th December 2016, About 6 years ago

Pam, I too have written to Ms Dinenage 3 times now and received the same clap trap responses as yourself. I am also aware of at least one other local resident who is writing to her. I am replying to all her responses with counter points and the one main driving point i keep asking is for her to give me her own view and not that of the establishment. She, like all politicians is being briefed in her responses and this means we are getting the message to others in parliament. It just beggars belief that they really seem to believe they are correct and we will simply absorb this ridiculous imposition without raising tents or evicting tenants in order to sell up to pay off debts. Cloud Cuckoo Land to the Nth degree in my opinion.
Keep up the pressure and I feel sure we will win this!

Steve B

Jennifer Aniston

11:06 AM, 17th December 2016, About 6 years ago

Hi Steve

I told Caroline that I run a volunteer counselling service at Gosport Medical Centre which offers free counselling to people who cannot otherwise afford it and provides training opportunities for trainee counsellors that otherwise would not have the opportunity to train. It was almost certainly this that swayed her to send me a personal response. I told her that selling up was my only option and that once I return to full time employment it's basically goodbye to the volunteer service. I am convinced this is why she has now asked me for a personal breakdown of the impact to me.

So now I'm waiting for my accountant to come back to me with the exact projected impact of Section 24 on my personal portfolio so that I can go back with exact details.

However, I feel that we keep deliberately getting dragged into a 'to me to you' type debate, about the right and wrong of the tax change (this is clearly getting us nowhere and people are bored with hearing it) when I think the focus needs to shift onto the human impact of this decision and the real consequences to those who are renting.

So my response letter to Caroline will begin with the brutal fact that I currently have five benefit tenants (two families with mental health issues), one tenant incapable of work because of his heart condition, he is obese and bed bound; one single mother with three children abandoned by her husband and not getting any support; one 53 year old woman who had a severe emotional breakdown and has been signed off work semi-permanently. The rest of my tenants are low income families who are nowhere in their wildest dreams ever going to afford to buy. My first question will be to ask what provisions have been made for these people? And it is a question I will continue to ask. Although I suspect the council will be currently looking at adding an additional 100 other tenant scenarios to which the phrase 'you have deliberately made yourself homeless' will apply.

Or is it the Government's plan to, once faced with a constant stream of occupied street doorways to, yet again, point the finger at the private sector landlord and shout 'this is because you were all too greedy'.

Last night on another of my Tweet rampages I sent the campaign link to as many Homeless organisations as possible but, to be honest, I'm not a Twitter expert and I have no idea whether I'm sending them to the right place! I'll get my act together after Christmas and become a 'Twexpert' and begin all over again.

I also sent them to all of the local counsellors listed on the Gosport Council website (there's loads of 'em!!).

I know it's only a teeny little campaign but I have to do something, doing nothing is not an option. So I'll keep going.

Pam

Gary Dully

13:25 PM, 17th December 2016, About 6 years ago

Reply to the comment left by "Pamela Potter" at "17/12/2016 - 11:06":

Pam,

As I have mentioned before, ask your tenants for permission to send an image and details of how they will be affected.

1. Your tenants won't blame you for the rent rises
2. Copy them in to your communication with your MP.

Spell it out, it's a rent rise, an eviction or government rethink.

It's time to give up being polite.

I have been looking at the new lending criteria from 1st Jan and the rent rises required to enable me to purchase, (or remortgage), my properties today are scary.

Add to that misery the effects of Section 24 and some of my properties require rent rises of over 124%.

These issues are a direct result of the war on BTL landlords by this government.

Gromit

12:57 PM, 20th December 2016, About 6 years ago

The experience of a lot of LLs on this forum is that until you have a face-to-face meeting with your MP they just "don't get it".

MPs are hardened to people complaining when legislation changes or new legislation is introduced - there's are nearly always some winners and losers. They also do not like rocking the boat as it may jeopardise their chances of promotion to a ministerial position. With Sec.24 they initially seem to think "oh is just a bit of extra tax/a few percentage points" that LLs are whining about, and dismiss it. Laying it out face-to-face and discussing the ramifications on Tenants i.e. rent rises, and evictions, and multiplying it up by the numbers affected they realise the impact that it is going to have. Even then, once they appreciate the implications, they still don't want to "toe the party line".I've even asked how they are going to sleep at night know that they are sitting on their hands watching the impending train crash happen knowing that they could have intervened.

At the next General Election, I will be asking them at various hustings what they did to prevent the then ensuing housing disaster?

Luke P

13:12 PM, 20th December 2016, About 6 years ago

Reply to the comment left by "Barry Fitzpatrick" at "20/12/2016 - 12:57":

Our local landlords association are regularly courted by one local MP (Con) to attend dinners for his fundraising that are always well attended. We are arranging the next one in Feb as normal, letting him book the venue etc. and then replying to the request for the number of tickets required as 'zero'. Then explain to him that there has been much muttering at our monthly meetings and a political shift amongst the landlords of our particular association away from the Conservatives because of S.24 (and his inaction)...this should wake him up a bit! I'm sure they believe we are blindly loyal to one party, just because we have traditionally voted for them. #CantWaitToSeeHisFace

Simon Griffith

15:04 PM, 20th December 2016, About 6 years ago

Love the idea but doubt he will care much. I asked UKIP about their policies on housing the other day and mentioned the number of potential disenfranchised landlords together with tenants who could be potential voters - yet to even have the courtesy of an acknowledgement - they're all the same - a bunch of disingenuous, power hungry, puffed up individuals devoid of any real life commercial experience. Any voting I will bother to do in the future will be to prevent other more damaging parties getting in rather than any conviction for the party I vote for.

Jennifer Aniston

15:14 PM, 20th December 2016, About 6 years ago

Reply to the comment left by "Barry Fitzpatrick" at "20/12/2016 - 12:57":

This is the question that I'm trying to force them to answer now.

No more debate about the '1 out of 5', no more throwing revised figures at each other. And whilst we must continue to bang that drum I think the Government have tied everyone into a bog standard response. So we get nowhere.

This is why I'm changing tack and, working on the assumption that it was the 'unheard voice' that voted in Brexit, voted in Corbyn and were clearly so desperate to be heard they'd even voted in Donald Trump, I'm thinking that perhaps we need to focus some more energy on the impact on tenants and put some real life stories out there about the direct impact on them and demand answers to that question 'What are you going to do about the homelessness". I think the system is rotten and people are wising up to it. If we can just find a way to harness the energy of the tenants then that would be an enormously powerful noise to ignore. But my little campaign is not enough on its own. To be honest, it's doing OK but gathering tenants into one collective voice is like herding cats! But I'll keep going.

I've even thought about starting a blog and asking landlords to put up pictures of themselves with one/two more of their tenants, talking about their relationship, how the relationship is mutually beneficial, and perhaps try to distance landlords from this Dickensian idea of the Scrooge type landlord who leaves their tenants in hovels whilst staying at home and counting their money. And then to explain the impact that Section 24 is going to have. Anyone think this is a good idea? I do think we need to put some human stories out there. Not sure how though.

Talking of being human. I've written to Caroline Dineage MP, again today and asked her the specific question about provisions being made for the forthcoming homeless and I will keep asking until she at least acknowledges that there are going to be tenants that lose their homes. I haven't heard one Tory even acknowledge this as yet. We need to perhaps force them to discuss it. By keeping the landlords tied to this fiscal debate they're having a very easy time about the moral aspect of this dilemma. It's about time we started to prod them on this too and we need to force them to look at some tenants in the face and explain to them what they're doing.

I'm good with a stick if anyone gives me an idea of who they think I should prod I'm ready.

Cheers

Pam

Gromit

16:56 PM, 20th December 2016, About 6 years ago

Reply to the comment left by "Pamela Potter" at "20/12/2016 - 15:14":

Pamela,

You're doing sterling work. Keep it up.

Local Councils have a legal liability for providing housing to the homeless (if they "qualify"). I and a few other LLs have been badgering our Local Councils about what plans they have in place to cope with a steep rise in homelessness, and a significantly reduced supply of properties in the PRS. There were recent reports that Peterborough Council had spent £1m+ with Travelodge to temporarily house homeless people.
I have suggested that as Central Government is causing this problem that Local Government should be pressuring Central Government for funds to solve the problem that they are creating.

Alex

18:07 PM, 23rd December 2016, About 6 years ago

"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." This statement was made by Jane Ellison, Financial Secretary to the Treasury.

We all know what a load of rubbish it is to compare owner occupiers and landlords. One is a business and should be able to offset all the costs of generating its profit before paying tax, the other isn't.

However, we must also be ever vigilant to challenge the last part of Jane Ellison's statement whenever this argument is used to support Section 24, i.e. “Nor is it available to those investing in other assets, such as shares”.

Jane Ellison is obviously as misinformed as much of the rest of the Government. HMRC certainly DOES allow tax relief on interest on qualifying loans used to lend money to, or buy shares in companies, subject to certain simple rules. See “HS340 Interest and alternative finance payments eligible for relief on qualifying loans and alternative finance arrangements (2015)”.

The rules to qualify are remarkably similar to the situation experienced by 99% of landlords with mortgages, i.e. needing to own at least 5% of the company (property), or working for the greater part of your time in the management and conduct of the company’s (property’s) business.

Make sure you ram this down anyone’s throat that compares investing in property to investing in shares as an argument to support Section 24!

Simon Hall

17:05 PM, 1st January 2017, About 6 years ago

Gavin Barwell, hits out on Buy To Let Landlords….government is now planning to introduce “GUILT TAX ” on Buy To Let Landlords as they are accused of crowding out first time buyers. In order to compensate first time buyers… Details in link. (This is likely to be part of Housing White Paper)

Happy New Year Mr Barwell.

https://www.thesun.co.uk/news/2463427/housing-minister-gavin-barwell-hits-out-at-rich-brits-with-second-homes-for-fuelling-nations-housing-crisis/

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