how does the budegt affect BTL?

Crashy_Time

Tan. wrote: »

So by limiting interest paid to basic rate tax, basic rate tax payers will get punished for just trying to make a living and will get taxed the full whack 20% on the interest amount previously deductible from profits.

Whereas actual buy to let investors who are higher rate tax payers will get a relatively small hit to their income in that they will "only" have to pay 20% on that amount, not 40%.

How exactly George, is this helping those on lower incomes?[/QUOTE]


It is putting BTL landlords out of "business" so that hard working people on lower wages can buy cheap flats.

Innys1

Crashy_Time wrote: »

It is putting BTL landlords out of "business" so that hard working people on lower wages can buy cheap flats.

Not quite. It puts some landlords out of business.

The remainder will make hay as the availability of houses to rent is squeezed even more, driving up rents further.

They will also probably buy up the housing stock released to the market by their erstwhile competitors.

jjlandlord

From today's reaction on the shares price of building companies, the market seems to think that this will mean less homes being built...

That's going to help.

Innys1

jjlandlord wrote: »

From today's reaction on the shares price of building companies, the market seems to think that this will mean less homes being built...

That's going to help.

So this change is likely to have the exact opposite effect to that intended - i.e. increase the supply of houses available for purchase and reduce rents.

Still, so long as it keeps the anti-BTL brigade happy, job done.

ScoobyZ

This isn't a tax relief or a tax break. it's a genuine expense on any but to let property.

the_hornet_2

The way I see it is that as a 40% tax rate payer, in affect I am currently getting £40 for 'free' by not having to pay that tax rate on every £100 of interest I am paying on my BTL (this is because I offset the whole thing against the income/profit). When the budget kicks in I will in affect only be allowed £20 for 'free' by off setting the interest.

- So for every £100 I pay in interest I will now have to pay an extra £20 in tax.

Madglover

Why doesn't the government do the simple thing of flooding the market with a huge amount of houses. The rental market is very messy but unemployment is markedly high, just build 100,000s of homes at cost. So not using contractors etc purely have the government buy the land, build the properties and sell them at cost or cost + 5% to improve the GDP position

All these halfway decision do very little. But to end the BTL mess house prices need to reduce and be made available only to FTB, I'd also implement a rule that should somebody wish to leave the property within 10 years they could only sell back to the Government. Prevents anybody trying to make a quick buck

Innys1

Madglover wrote: »

Why doesn't the government do the simple thing of flooding the market with a huge amount of houses. The rental market is very messy but unemployment is markedly high, just build 100,000s of homes at cost. So not using contractors etc purely have the government buy the land, build the properties and sell them at cost or cost + 5% to improve the GDP position

All these halfway decision do very little. But to end the BTL mess house prices need to reduce and be made available only to FTB, I'd also implement a rule that should somebody wish to leave the property within 10 years they could only sell back to the Government. Prevents anybody trying to make a quick buck

Nice idea - where and how will this be paid for?

jjlandlord

Madglover wrote: »

So not using contractors etc purely have the government buy the land, build the properties and sell them at cost or cost + 5% to improve the GDP position

You mean giving civil servants a shovel and a hard hat and telling them to get on with it?

Old_Git

Am I correct in thinking the 10% allowance for wear & tear is ending .
This was a nice bonus for me .