Tax implications of a HBOS staff mortgage

opinions4u

411444 wrote: »

This is the first time I have used one of these sites and the messages I have received so far have obviously show me that I was extremly naive in expecting some useful help.

In what way was my post not useful?

1) I questioned why you were unable to repay your mortgage over the term, depsite being in a role that (probably) pays well and requires a certain level of ability and intelligence? It might help if you answer this.

2) I explained that you (probably) didn't receive advice for the mortgage as they don't provide mortgage advice on the staff mortgage deal.

3) I pointed you in the direction of your own mortgage paperwork and also internal communications accessible from every PC within Lloyds Banking Group.

4) I calculated your average interest rate for you.

5) I calculated your tax liability as a percentage of loan for you.

6) I calculated your effective interest rate taking in to account the tax liability thus allowing you to compare the current mortgage against others in the market.

7) I also explained how your tax code might be affected if HMRC are clawing back your liability for previous tax years.

I'm sorry you don't find it useful.

Simon_gloster

411444 wrote: »

In Febuary 2010 I took out an interest only HBoS staff mortgage for £193,166 for a term of 13 years. The mortgage was split by £156,600 being charged at Bank od England base rate of 0.5% and £36,566 charged at the standard variable rate of 5.19%.

I would like to know if you think I have been mis-sold this mortgage because of the following reasons: -

1. I cannot afford to pay the mortgage off at the end of the term.

2. I wasn't made aware, by the HBoS mortgage advisor, that I would have to pay tax on the benefit in kind at the time of taking out the mortage.

3. I was not made aware, by the HBoS mortgage advisor, that HMRC would calculate the tax on the benefit in kind using the total mortgage amount of £193,166 instead of using £156,000 which where I am receiving the benefit, the interect rate of 0.5%

I think the OP has had a beating on this thread and I'm not going to add to it; so I would just like to re-iterate what O4U siad......These mortgages are conducted on a Non-Advice basis. The OP will have made their own choice about the product, term and repayment method.

It may have been 'good practice' for them to tell you about tax implication etc, but by law they don't have to. I'm pretty sure when you signed up to HBoS they would have given you papaerwork around the benefits in kind available.

End.