Nifty
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Posts: 4,963
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Post by Nifty on Dec 4, 2022 18:36:24 GMT 1
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Post by pcpa on Dec 4, 2022 19:09:55 GMT 1
"It means that landlords are no longer allowed to offset any of their financial costs against tax. So instead of being taxed on our profits, we're now taxed on our turnover. So we are actually taxed on money that we don't have." Completely untrue, basic rate taxpayers are still able to offset 100% of their mortgage payments, higher rate taxpayers will be limited to 20% tax relief. All other legitimate operating costs are still deductable so the part about paying tax on turnover not profit is an absolute lie. It has always been abhorrent to me that buy to let landlords with multiple properties can borrow money at a significantly lower rate of interest than the rental return on the property and then offset those mortgage payments against tax yet someone who rents out their own home (perhaps moving in with a new partner or moving for work) and who has paid off their mortgage gets no benefit. I recently sold my UK property which had been rented out for 15 years, thanks to the recent rise in interest rates the proceeds are now bringing in 60% more interest than the rental income with no expenses, hassle or risk. No risk aside from losing everything if the building society goes bust that is
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Deleted
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Post by Deleted on Dec 4, 2022 19:11:33 GMT 1
If your set up properly in France you get most allowances. We even get allowances for the kilometres we cover every year no matter what we are driving. France is a high taxing country but your article makes it almost impossible to be a landlord with mortgages in the UK.
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Post by tim17 on Dec 4, 2022 19:18:39 GMT 1
I would say the landlord in the article is in the minority because most private landlords (ie not companies) own less than 10 properties with many only having 1 or 2, he is right though in what he says.
It's not just the Section 24 introduction that has made things less attractive for landlords, the upcoming removal of 'no fault evictions' (Section 21) and up rating of the EPC energy certificate for tenanted properties will see 0000's more sell up which will reduce further the availability in the private rented sector.
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Post by pcpa on Dec 4, 2022 21:51:03 GMT 1
He is not right when he says - "So instead of being taxed on our profits, we're now taxed on our turnover. So we are actually taxed on money that we don't have."
Whereas in France as a private landlord declaring one or more rental properties on their declaration d'impots that is exactly the situation albeit with a fixed abattement.
It's a fair system, the contribuables should not be financing reckless peoples borrowing and property speculation which is exactly what the UK system did and still does to a great degree.
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Nifty
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Posts: 4,963
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Post by Nifty on Dec 5, 2022 8:31:13 GMT 1
In simple terms, Section 24 removes a landlord's right to deduct mortgage interest and other finance costs (such as mortgage arrangement fees) from their rental income before calculating their tax liability.Jan 27, 2020 From What Landlords Need to Know About Section 24
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Post by tim17 on Dec 5, 2022 8:32:23 GMT 1
He is not right when he says - "So instead of being taxed on our profits, we're now taxed on our turnover. So we are actually taxed on money that we don't have."
Whereas in France as a private landlord declaring one or more rental properties on their declaration d'impots that is exactly the situation albeit with a fixed abattement.
It's a fair system, the contribuables should not be financing reckless peoples borrowing and property speculation which is exactly what the UK system did and still does to a great degree.
Takeaway the private rented sector and millions would be homeless, the problem is successive governments have failed to address the social housing shortage whilst at the same time they've allowed a certain type of landlord to profit massively from low interest rates and uncontrolled rent levels. People will probably be unaware but companies such as John Lewis and Lloyds Bank have now entered the rental sector with the aim of creating huge portfolios of 0000's of properties, if this is a success then many more will pile in so in 10 years time the likes of the guy in the linked article will have disappeared.
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Nifty
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Posts: 4,963
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Post by Nifty on Dec 5, 2022 8:41:17 GMT 1
I thought that people like Allied Dunbar already had the bulk of the retail outlet sector sewn-up.
This ad makes me wonder if they will be so reliable when the other horsemen arrive
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Nifty
Member
Posts: 4,963
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Post by Nifty on Dec 5, 2022 12:28:16 GMT 1
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Post by tim17 on Dec 5, 2022 12:42:06 GMT 1
Those so called 'dodges' are out of date and much less advantageous now, Corporation Tax is rising to 25% next year and the Capital Gains Tax allowances are also being reduced.
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Post by pcpa on Dec 5, 2022 13:05:19 GMT 1
In simple terms, Section 24 removes a landlord's right to deduct mortgage interest and other finance costs (such as mortgage arrangement fees) from their rental income before calculating their tax liability.Jan 27, 2020 Incorrect. Whilst they are not deducted from declared income as before they are declared and a 20% deduction is allowed against any tax liability
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Post by tim17 on Dec 5, 2022 15:54:10 GMT 1
In simple terms, Section 24 removes a landlord's right to deduct mortgage interest and other finance costs (such as mortgage arrangement fees) from their rental income before calculating their tax liability.Jan 27, 2020 Incorrect. Whilst they are not deducted from declared income as before they are declared and a 20% deduction is allowed against any tax liability Whatever you think of the rights of being able to buy multiple rental properties for very little initial outlay it is going to cause problems going forward now that interest rates have rocketed and not just to landlords.
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Post by pcpa on Dec 5, 2022 18:17:26 GMT 1
What does that have to do with my posting you quote stating the information was incorrect?
Would it help you to focus if I were to remove my opinionated comment? I am happy to do so, it does seem to have sidetracked the thread.
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Post by tim17 on Dec 5, 2022 19:23:11 GMT 1
What does that have to do with my posting you quote stating the information was incorrect? Would it help you to focus if I were to remove my opinionated comment? I am happy to do so, it does seem to have sidetracked the thread. Apologies, I meant to quote a different post. I think it's a valid opinion and is one of the reasons why many people think all BTL landlords are scum because they have gotten rich off the backs of tenants when in reality very few are.
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Post by pcpa on Dec 5, 2022 21:03:27 GMT 1
Thanks, I thought afterwards it was probably that.
It's always been like that Tim, I rented out my first property around 40 years ago now and people were calling me Rachman, I had never heard of him!
The rent did not cover a fraction of the mortgage payments and I sold the flat at a loss a few years later, negative equity, it taught me a lot!
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