CAN A FIRST TIME BUYER AVOID STAMP DUTY AND BECOME A LANDLORD?

NOVAMET21

Salemicus said:

How is this bending the rules? It's just breaking them. Why is there "no income tax to pay for the first 2 years"? If you declare that income to HMRC, you'll have to pay tax on it. If you don't, that's tax fraud - but there's nothing special about the first 2 years. It's possible to commit tax fraud at any time!

Earning money and not declaring it to HMRC is not some cunning, brilliant wheeze that you've just thought of for the first time. It doesn't even require the mortgage fraud you also contemplate. Just buy a BTL and don't declare your income! Or any other income, for that matter. I doubt there are hundreds of thousands of people doing what you suggest, but there probably are hundreds of thousands fiddling their taxes in some way. It may even work out for some of them. But an awful lot of them get hit with fines and penalties, and end up significantly worse off than if they'd played by the rules to begin with. I've always believed that honesty is the best policy, but you do you.

People are quick to judge and this is not my idea but I believe have been done by thousands if you think about it. As a note, I have already stated that I own my house and live in it.
The reason I say no income tax to declare for the first 2 years is because the owner won't declare that it has been used as buy to let. Otherwise that person would have get caught. Intending to live in the property but actually always had an idea of using the property as buy to let, it will give these people SDLT relief, less deposit, cheaper interest rate, etc. Then after 2 years these people would declare that they have decided to let the property and pay the income tax from year 3. Make sense?
Again I repeat it is not my idea, its increasing I believe each year and there is very less way to catch these people.

davidmcn

NOVAMET21 said:

Salemicus said:

How is this bending the rules? It's just breaking them. Why is there "no income tax to pay for the first 2 years"? If you declare that income to HMRC, you'll have to pay tax on it. If you don't, that's tax fraud - but there's nothing special about the first 2 years. It's possible to commit tax fraud at any time!

Earning money and not declaring it to HMRC is not some cunning, brilliant wheeze that you've just thought of for the first time. It doesn't even require the mortgage fraud you also contemplate. Just buy a BTL and don't declare your income! Or any other income, for that matter. I doubt there are hundreds of thousands of people doing what you suggest, but there probably are hundreds of thousands fiddling their taxes in some way. It may even work out for some of them. But an awful lot of them get hit with fines and penalties, and end up significantly worse off than if they'd played by the rules to begin with. I've always believed that honesty is the best policy, but you do you.

I believe have been done by thousands...

it's increasing I believe each year

Based on...what? Guesswork?