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Turnbull2000

Guardian - Bring On The Catastrophe

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Bring on the catastrophe

The tax giveaway on buy-to-let doesn't stop at writing off their interest payments. Buy-to-letters can also take advantage of "taper relief" on capital gains tax, and can access a £40,000 "lettings allowance". And if they set themselves up as a company, they can even avoid having to pay much in the way of stamp duty.

Meanwhile first-time buyers are facing absurd house prices of five to 10 times their income, depending on where they live. How much tax relief did these people enjoy last year? Zero. No wonder buy-to-let landords can afford to snap up as much as half or more of all newly-built properties in London and other cities across the UK. And no wonder our postbag is full of tales of woe from those elbowed aside by the buy-to-let brigade or who are suffering from the blight brought on their neighbourhoods.

Brilliant! :lol:

Edited by Turnbull2000

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It's not brilliant, it's ramping to extend tax relief to FTB rather than take it away from BTL, in my opinion. That's the last thing we need.

So what you have to do is register your company. Then buy the property in a company name.

If it loses money then you can make back that money TAX Free.

So when I come back to the UK, I can work for the company that made a loss until I make back the profit, then until that point TAX Free income....

But what is Brilliant is that you'll have to do the accounts for it, or pay an accountant.

Pay Tax on any income from a Tenant, "so no getting round that"

If you be LTD then anyone can see your accounts.

I own Twenty-3 LTD,, have a look at my accounts if you want to....

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It's not brilliant, it's ramping to extend tax relief to FTB rather than take it away from BTL, in my opinion. That's the last thing we need.

Very unlikely to happen though, thankfully. What chance a bankrupt Gordo cutting taxes?

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Very unlikely to happen though, thankfully. What chance a bankrupt Gordo cutting taxes?

Strikes me a club needs to be organised where everyone becomes a BTL and exploits the tax consessions. So everyone in the "club" forms a company and then buys a house (assuming this is affordable).

The thing is you then move in, not the house you have actually bought but into someone elses house in the club on an AST.

Of course GB will come down on hard on UK denizens that exploit his tax perks he's created for the rich. However it will kill it for them also.

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It's not brilliant, it's ramping to extend tax relief to FTB rather than take it away from BTL, in my opinion. That's the last thing we need.

You can write-off mortgage interest against the tenant's rent right? If so then it may be an idea to buy a house for my sister and have her pay rent, as opposed to having her pay the stamp duty and also risk losing her investment.

But not now, oh no. Im waiting for that little blue graph on the front page to come down before I buy.

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BTL are bag holders, in fact most of this country are bag holders, where is Mr Blair when all this s**t goes down. Oh and Brown hes a bag holder to, biggest of them all.

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I could see Gordon Brown looking at ending this BTL taxbreak - the vast majority of voters don't have buy to lets and those who do probably vote Tory anyway. He and his successor as Chancellor are running out of money to pay for everything they wan't to do - so why not target people who most people in the UK don't particularly like.

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I could see Gordon Brown looking at ending this BTL taxbreak - the vast majority of voters don't have buy to lets and those who do probably vote Tory anyway. He and his successor as Chancellor are running out of money to pay for everything they wan't to do - so why not target people who most people in the UK don't particularly like.

I think you're spot on. Brown has an ever expanding black hole in the public accounts which he has to fill and increasing the tax take on the army of BTL's would go some way to alleviate this problem in the short term. BTL'ers would also make a convenient scapegoat for the growing tensions in the housing market and could be blamed when prices start crashing.

The media are filling up with stories attacking BTL which indicates that summat's afoot. There's two in the pro-New Labour Guardian today probably inspired by contacts from within the Treasury. Here's the second:

First-time buyers vs landlords? With £2bn tax relief, no contest

Patrick Collinson reveals the staggering scale of tax relief claimed by property investors - and looks at how this has hit the market

Saturday June 23, 2007

The Guardian

Buy-to-let investors enjoyed tax relief worth £2bn in 2006 - in stark contrast to first-time buyers, who do not qualify for a penny, research by Guardian Money reveals.........cont

I read this as BTL's coming in the firing line for a tax squeeze rather than a move to give tax relief to FTBs.

Guardian

Guido Fawkes

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Who fancies starting up 2 BTL companies with me, we will both buy a house and let it to each other.

Edit: Just seen rover2000 was thinking along the same lines!

Edited by OzzMosiz

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Hang on tho'.

Aren't we being a little overly pessimistic here.

Old Rupert Jones here is coming out with quotes like this in a national newspaper...

"But if you speak to the lenders financing the £100bn buy-to-let boom, then any tinkering with the tax breaks they enjoy will result, they say, in catastrophe for the housing market. If the tax relief is axed, then buy-to-letters will start dumping their properties on the market, sparking a collapse in house prices.

But if that's a catastrophe, then bring it on. Why does one side of the British brain say that high inflation is a dreadful thing, but the other side insists that ludicrously high house prices are a wonderful thing?

A fall in house prices, or at the very least a halt to rising prices, is probably now essential. Traditionally, it is interest rates that are used to cool overblown markets. The problem is that they are an extremely blunt tool and rising rates hurt everybody - homeowners and businesses alike."

and then signs off with.....

"The new prime minister has a golden opportunity to re-balance Britain's grossly lop-sided housing market, and tackling the excesses of buy-to-let should now be at the top of his agenda."

Amen to that brothers & sisters!! - (only he won't!)

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About a year ago, I was thinking that no main stream newspaper was

printing anything I could relate to anymore.

Someone's obviously got the bit between the teeth recently at the Guardian;

more please!

Actually; since newspaper sales have been declining across the board;

maybe this is the sort of content they need to get younger people reading newspapers again.

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Hang on tho'.

Aren't we being a little overly pessimistic here.

Old Rupert Jones here is coming out with quotes like this in a national newspaper...

"But if you speak to the lenders financing the £100bn buy-to-let boom, then any tinkering with the tax breaks they enjoy will result, they say, in catastrophe for the housing market. If the tax relief is axed, then buy-to-letters will start dumping their properties on the market, sparking a collapse in house prices.

I think Mandy Rice Davies had the right retort for that.

Its the same with the non domicile rules. If you tax the rich they will all leave (bye!). Over the past week the VI's have been wheeling in the big journalistic guns to defend them.

Edited by rover2000

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Guest happy?
Doesn't the tax releif on the mortgage interest mean the landlords can offer cheap rents, discuss. <_<

It does, but if you've got a monopoly because you've hoovered-up the market with interest-only loans from the B&B why would you? Assumes of course that the B&B will still be here a year from now.

The B&B is a solid business built on risk-managed lending policies - discuss.

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You can write-off mortgage interest against the tenant's rent right? If so then it may be an idea to buy a house for my sister and have her pay rent

I know a brother and sister who did exactly that - they each live in the other ones BTL - works for them!

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You can write a lot of things off against the income from most businesses not just BTL. The key point though is you have to have the earnings before you can claim tax relief. If your property is sitting empty earning nothing it is not going to do you much good. Furthermore as we all know a good proportion of amateur BTL are simply failing to declare any of their income from this source to HMRC so the question of tax relief becomes irrelevant to their business model which is essentially based on fraud.

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Threre seem to be a lot of stories planted in the press at the moment designed to soften us up for massive tax increases. Not just in the Government-financed Guardian.

Be very afraid...

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Threre seem to be a lot of stories planted in the press at the moment designed to soften us up for massive tax increases. Not just in the Government-financed Guardian.

Be very afraid...

"Bring on the Catastrophe" is just an opinion piece though. Today's leader is Things did get better

A decade with a capable, confident man in No 11 has provided stability for the economy and reassurance for individuals and businesses, even if they sometimes moan about the cost. Mr Brown's successor will struggle to match the record.
Edited by Turnbull2000

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Doesn't the tax releif on the mortgage interest mean the landlords can offer cheap rents, discuss. <_<

If so, they're only offering cheap rents to people who would otherwise have been able to buy that property themselves had a BTLer not come along and snaffled it up with all their tax breaks etc.

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Who fancies starting up 2 BTL companies with me, we will both buy a house and let it to each other.

Edit: Just seen rover2000 was thinking along the same lines!

I'm not actually clear that this would save you any money - you wouldn't pay any tax on the income if it was less than the mortgage, sure, but you'd have no extra cash. Say the mortgages were £600 a month, you'd have £600 a month coming in and £1200 going out, instead of just £600 going out.

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I've read the original post, the Guardian article, the hostile reactions, and then the Guardian article again thinking maybe I'd read it wrongly.

I hadn't.

The guy very clearly argues for the removal of tax breaks for BTL landlords, not the extension of these breaks to FTBers.

He also argues for the introduction of new tenants rights, to make even more unnattractive the prospect of being a landlord.

He suggests that the collapse in the housing market resulting from these actions would be a good thing.

I agree with every word! What is there to argue with?

This problem all started with the removal of tax relief on mortgage interest for owner occupiers (MIRAS). Miras operated as a state subsidy for owner occupiers, and came to be seen as being unfair on people living in rented accomodation. I don't remember very much objection to it being reduced and then abolished.

What was not generally forseen however, was that the removal of Miras together with the treatment of private landlords under general commercial tax law would mean that they now had the advantage. Throw into the mix new tenancy agreements favouring landlords and the intoduction of BTL mortgages and the current situation developed whereby most prospective FTBers are completely frozen out of the market.

Gordon Brown has a golden opportunity to make a name for himself and make housing affordable again for our young people. Sure, there will be a little collateral damage, but BTLers all vote Tory anyway and anyone who has stepped onto the ladder in the last couple of years knew the gamble they were taking.

I have funny feeling that this is just the kind of move that Gordon might make. He's a parsamonious presbyterian Scot who would love to see all those arrogant smooth middle class English BTL bastards squeal. It would also win him votes and make him look even less like Tony.

Catastrophe? Bring it on!

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I would not expect Crash Gordon to do anything to alter the direction of the miracle economy. His legacy is based on giving people wealth in the form of HPI-MEW-BTL in exchange for higher taxes, lower standards of living, priced out FTBs and essential workers, declining manufacturing base, rising immigration to suppress wages and the social suffering that follows on from all of these core policies.

The Observer Poll out today suggests Brown is more popular than the Tories. This seems unlikely but it does reflect the reality that there is a leadership crisis in this country. The scene is ripe for a de facto dictatorship and Brown would fit the bill nicely. I suspect this is why the Libs would not go near Brown--people fear him and do not want the stress of working under his authority and control.

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