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A classic post on our favourite landlord's union website

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Check it out - "section 24 will make me bankrupt"

Some lovely stuff in there, following the obligatory preamble concerning what they have done for their country, including 

"Having started with one property of our own to rent we have over the years managed to build up a good size portfolio of properties that we own, all on interest only mortgages as this was the advice we were given when we were purchasing buy to let properties".

Sheep follow advice.

I would be asking them "What are you doing for your country now?"

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7 hours ago, Trump Invective said:

properties that we own, all on interest only mortgage

You don't own them you bell-end.

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Thing is, none of these muppets took advantage of secular low interest rates to offset the capital repayment and they literally have nothing to show for their effort. 

 

Actually, no. They have a ******ing massive tax bill coming :)

 

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4 minutes ago, GreenDevil said:

Haha too funny.

Funny how one of the comments compare the housing situation to empty housing of that in Poland.

Oddly, the people I've heard about getting into BTL recently have all been eastern european.

By all accounts, they think there is a fortune to be made.

When the UK leave the EU ( :lol: ) I wonder what chance the UK banks have of ever seeing their money again.

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'One way is to try and increase the number of properties on our books by attracting new landlords. It is very difficult to pretend that getting into buy to let is really an attractive proposition for potential new landlords.'

Aren't ponzi schemes illegal? 

I have some sympathy here. I'd be prepared to throw something into the hat to ensure that the parrot doesn't go hungry... 

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>we chose to set up our own company as a Letting Agency 

  Yet couldn't resist getting into BTL (highly leveraged speculation) directly.

we have a profit from our portfolio of buy to let properties

   we have a profit from our hoard of buy to let properties

> hard earned money

Rentier loot

>we have to pay 32.5% on every dividend we take. How can this be fair.

  Tenants pay 20/40% PAYE and 12% National insurance and have to work for it. How can this be fair?

>we are normal hard working people

Nope, just middlemen between the banks and the tenants.  Just collect commission and do as little work as possible.

>How can it be in this country, that a loyal proud British couple can work hard for their country, then set up a business to better themselves and their family whilst at the same time genuinely help thousands of tenants and landlords, but be forced through no fault of their own be pushed into bankruptcy by an evil, uncaring greedy tax scheme.

They may have worked hard in the past but now want to be parasites on those working .

It's their highly leveraged BTL speculations that will make them bankrupt, not the lettings agency.

 

 

 

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12 minutes ago, dougless said:

I almost feel sorry for them.....

They are just hoarders of first-time buyer properties. Every one they bought  made it harder for everyone else.  When they go bankrupt, I hope they end up renting from the next parasite up the housing food chain.

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If you borrow to do any other business, then do you get a tax-relief on your interest, no? so why on the BTL you should get the tax relief.

To be honest, I did not know that such tax relief existed until Section 24 was announced in 2015. UK government should have never allowed this tax relief in the first place. It was mistake which they taken too long to realize and correct.

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2 minutes ago, suresh786 said:

If you borrow to do any other business, then do you get a tax-relief on your interest, no? so why on the BTL you should get the tax relief.

To be honest, I did not know that such tax relief existed until Section 24 was announced in 2015. UK government should have never allowed this tax relief in the first place. It was mistake which they taken too long to realize and correct.

I don't think many people realised. I wonder how many renters would be happy with their landlords' tax breaks.

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1 minute ago, oatbake said:

I don't think many people realised. I wonder how many renters would be happy with their landlords' tax breaks.

Totally unfair tax relief which encourage people to borrow more. For example if someone can afford to buy outright or pay bigger deposit but he/she will not, as paying less deposit and taking bigger mortgage will cause bigger interest payment and bigger tax-relief.

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Lets say I have the money 100k-pounds and i am looking to buy a flat of 200k-pounds then rather than giving deposit of 100k-pounds i would give lets say 50k-pounds so interest is higher on mortgage to give me bigger tax relief and remaining 50k-pounds i would invest some where else or even to buy another flat of similar value. This tax relief was very dangerous.

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7 minutes ago, suresh786 said:

Lets say I have the money 100k-pounds and i am looking to buy a flat of 200k-pounds then rather than giving deposit of 100k-pounds i would give lets say 50k-pounds so interest is higher on mortgage to give me bigger tax relief and remaining 50k-pounds i would invest some where else or even to buy another flat of similar value. This tax relief was very dangerous.

Yes, extremely distorting to the market.

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2 hours ago, VeryMeanReversion said:

They are just hoarders of first-time buyer properties. Every one they bought  made it harder for everyone else.  When they go bankrupt, I hope they end up renting from the next parasite up the housing food chain.

I did say ALMOST.  I haven't felt much sympathy from the general population when i stump up my rent every month.

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SCUM BAG to the rescue. 

 

 

Mark Alexander

A week ago
 

Hello Mark and thank you for sharing your story.

You've made it though two wars and you can make it through this one too.

Let's look at how you could transfer your property rental business into a company without having to pay CGT, or Stamp duty, or to refinance.

The benefit of doing this in your case would be that your property rental company would be unaffected by the section 24 restrictions on finance cost relief.

Starting with CGT. If you haven't made any capital appreciation on your property rental business then CGT isn't an issue. If you had made capital gains, there is incorporation relief to roll your gains into shares in a company you transfer the properties into - see https://www.gov.uk/hmrc-internal-manuals/capital-gains-manual/cg65700

To qualify for this relief you must be running a business. HMRC's definition of a rental property business can be found via this link https://www.gov.uk/hmrc-internal-manuals/capital-gains-manual/cg65715

If you are running a business, the fact that it involves two owners with a view to making profit constitutes a partnership according to the Partnership Act 1890 - see https://www.legislation.gov.uk/ukpga/Vict/53-54/39/contents

If you are both a business and a partnership then under schedule 15 of the finance act 2003 there are provisions to exclude transfers of your property rental business into a company from SDLT providing you transfer the 'whole business'. Guidance notes from HMRC are published here https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm33110

There is a structure know as BICT which will enable you to retain your existing mortgages - see https://www.property118.com/tax/beneficial-interest-company-transfer-bict-structure-explained/

Excuse the intentional air force and military puns that follow please.

I accept that your're taking a lot of flack but there is weaponry available to you so you don't have to face this unarmed. If you rely on us as your command and control centre we will be with you all the way to give you the best possible chance of getting through this.

Please book a consultation via the link below so that we can complete a thorough Fact Find and a bespoke report and recommendations. You need to cross a minefield and if you're going to get across intact, a map plotting a safe route is what you're going to need. We can provide that.

 

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Regarding s24, one comment, similar to many, says:  "Every time I hear the name George Osbourne I feel sick to the pit of my stomach and am just one step short of throwing up".  So did I, until now!  He's still on my sh*t list though!

Other people have also served this country and more than just "the Gulf War and Yugoslavia conflicts" and will spend a lifetime "away from" their dead mates after doing a far more dirtier job than "flying maritime patrols and conducting search & rescue missions".  This sort of language and rationale is inappropriate as it is offensive.  There are things more important than housing.

There may have been a point but I no longer care.  But then the post sounds a bit fake.

Edited by Fence

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