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Byron

A Nasty Thought

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If I understand correctly, the introduction of the new reduction of income tax relief is to be implemented in stages, 25%,50% 75% 100% by 2020.

I wonder, just wonder whether someone at the Treasury has pencilled in further 25% staged reductions in relief after 2020 at the 20% rate?

Edited by Byron

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If I understand correctly, the introduction of the new reduction of income tax relief is to be implemented in stages, 25%,50% 75% 100% by 2020.

I wonder, just wonder whether someone at the Treasury has pencilled in further 25% staged reductions in relief after 2020 at the 20% rate?

The 'risk' would be that they limit the tax relief (at 20%) to the basic rate - ie, no relief at all over the upper threshold. (or, perhaps, the higher threshold. This would kind of make sense as it would send a strong message, but in reality anyone with that size of portfolio would be trying very hard to exist as a ltd company, so it wouldn't in fact affect many at all).

More likely is that they introduce tax relief at 20% for all mortgage holders - but they would only do this if the housing market started to slip.

Most likely (imo) is that they stick to their plan-a.

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Mrtickle.

Please be careful, I have already had one nasty attack of over-gloating and I don't want another.

Byron

But they're so very amusing for the rest of us! :D

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The more I have looked at the budget change, the targeted nature, the phasing, the cohort it impacts, the sentiment it generates and those who it does not impact..,.the more I realise just how precise and effective it is.

In real economic housing terms it's very effective but in political terms it is genius.

There won't be a dry eye in the house when 118 march on Downing Street. Those poor leveraged Higher Rate Tax Payer Landlords will receive huge amounts of sympathy from the public. :). "Stupid fireman, nurses and disabled - they don't know what real unfairness is." will be the shouts from the public.

You are right and whilst we can't know if your possible 2021 scenario WILL happen it brilliantly raises the question that if it doesn't then what is next? I am sure they thought about this - and perhaps waiting to assess impact to the implement the next phase. Impact in HPI but I think they will be looking to see if there is a 'work around' adopted by BTL'ers (well the guru advisers) - the the government move again.

Its a great shout and makes me think the sequel is being pencilled - I am sure if that. Your suggestion is a good as any.

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Another 5 years.... They should have brought 50% next year, and 100% after that TBH.

+1

Indeed - it's far too gradual and the suspicion is that they're hoping that as time goes on "recovery" in the general house price market will mitigate the effect of the tax relief changes. So they'll get the benefit of the tax relief changes plus increasing house prices.

They're not to be trusted, not to be trusted at all. One can't emphasise that strongly enough about the traitors as the general economy continues to get worse. However there is also the small hope that they've seen their abject failures and are now trying to do something about it but it's only a very very small hope.

Edited by billybong

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