How does Buy to Let END!

[MrXxxx]

2 hours ago, spygirl said:

SVB going bust n CS point to banks needing to hold more capital, therefore credit costs more.

Banks holding too much gov binds means they need to drop bonds, meaning higher bond yields meaning more expensive credit.

This wasn't the issue with SVB, it was the type of bond they held i.e. medium-term rather than short-term bonds. As a result when creditors asked for their money back SVB had to sell the bonds at a [temporarily] depressed value rather than their end of term face value.

[darkmarket]

We've heard a lot over the past few years about 'pent-up demand'.

I suspect ongoing events, and the psychological shift they're causing, may be the catalyst for pent-up supply to hit the market.

[Rare Bear]

7 hours ago, spygirl said:

Theres all sort of reason why housing debt is going to get more expensive.

SVB going bust n CS point to banks needing to hold more capital, therefore credit costs more.

Banks holding too much gov binds means they need to drop bonds, meaning higher bond yields meaning more expensive credit.

Only way out of 2008 was always less debt at higher rate.

I was seriously astounded in 2008 to see rates slashed instead of increased. I would have hurt for a while but it would have fixed things rather than put it on the long finger.

[spygirl]

7 hours ago, Rare Bear said:

I was seriously astounded in 2008 to see rates slashed instead of increased. I would have hurt for a while but it would have fixed things rather than put it on the long finger.

When they lashed IRS they should have fixed  all repayments so all the bank debt was paid off quicker.

Cutting IR after a massive credit bubble was nuts.

 

 

[Guest]

https://twitter.com/jjsmclaughlin/status/1639342315113177095

 

[spygirl]

1 hour ago, Darude said:

https://twitter.com/jjsmclaughlin/status/1639342315113177095

 

It's going to be about that.

Then about 10k in fines.

[Phil]

41 minutes ago, spygirl said:

It's going to be about that.

Then about 10k in fines.

The prick wasn’t to concerned when the house price went to the moon. I’m warming to HMRC. HAHAHA.  Every cloud and all…..

[Guest]

2 hours ago, Phil said:

The prick wasn’t to concerned when the house price went to the moon. I’m warming to HMRC. HAHAHA.  Every cloud and all…..

HMRC have released various estimates over the last few years of how many landlords aren't declaring rental income for tax purposes, typically between 0.7-1.5m. In Newham when the council introduced compulsory landlord registration it was found that half of landlords were not declaring (and presumably that misses the ones who didn't register with the council either):

https://www.theguardian.com/business/2017/aug/13/half-of-landlords-in-one-london-borough-fail-to-declare-rental-income

It's crazy really. Between the Land Registry, the electoral register, notifications from letting agents and various other databases HMRC have access to it should be pretty simple to catch the large majority of non-declarers and chase them for every penny owed plus fines.

[Wight Flight]

1 minute ago, Darude said:

, notifications from letting agents

This has been the case for 30 years.

If HMRC haven't bothered with the cross checks then they are not fit for purpose.

[One percent]

Just now, Wight Flight said:

This has been the case for 30 years.

If HMRC haven't bothered with the cross checks then they are not fit for purpose.

They are not fit for purpose. I’m on PAYE and they can’t get that right.  

[Wight Flight]

1 minute ago, One percent said:

They are not fit for purpose. I’m on PAYE and they can’t get that right.  

I thought you had abandoned the notion of earning?

[Guest]

9 minutes ago, Wight Flight said:

This has been the case for 30 years.

If HMRC haven't bothered with the cross checks then they are not fit for purpose.

My guess is there has been a bit of a 'don't ask don't tell' unspoken deal going on between ministers and HMRC over non-declaring landlords for a long time. Ministers didn't want a million or 2 non-declaring landlords to run for the exits because it would upset their mortgage lenders and dent property prices so they didn't ask HMRC to put their backs into finding them (and more importantly forcing them to cough up). HMRC were fine with that, less work for them.

Edited March 25, 2023 by Guest

[Wight Flight]

2 minutes ago, Darude said:

My guess is there has been a bit of a 'don't ask don't tell' unspoken deal going on between ministers and HMRC over non-declaring landlords for a long time. Ministers didn't want a million or 2 non-declaring landlords to run for the exits because it would upset their mortgage lenders and dent property prices so they didn't ask HMRC to put their backs into findisng them. HMRC were fine with that, less work for them.

The other possibility is that until the rules changed most landlords didn't actually make a taxable profit, so it wasn't worth the effort to track them down.

[One percent]

7 minutes ago, Wight Flight said:

I thought you had abandoned the notion of earning?

No, working. I still have an income.  

[Wight Flight]

2 minutes ago, One percent said:

No, working. I still have an income.  

Well done. Have you gone back to teaching?

[One percent]

7 minutes ago, Wight Flight said:

Well done. Have you gone back to teaching?

Pension.  

[Guest]

9 minutes ago, Wight Flight said:

The other possibility is that until the rules changed most landlords didn't actually make a taxable profit, so it wasn't worth the effort to track them down.

Depends how you define "worth the effort". If the only goal was for HMRC to extract lots of money then perhaps not. If the government wanted to push financial zombie landlords towards the exit so they could be replaced with first time buyers then chasing the non-declarers regardless of the sums involved would make sense.

[spygirl]

10 hours ago, Wight Flight said:

This has been the case for 30 years.

If HMRC haven't bothered with the cross checks then they are not fit for purpose.

 

10 hours ago, Darude said:

My guess is there has been a bit of a 'don't ask don't tell' unspoken deal going on between ministers and HMRC over non-declaring landlords for a long time. Ministers didn't want a million or 2 non-declaring landlords to run for the exits because it would upset their mortgage lenders and dent property prices so they didn't ask HMRC to put their backs into finding them (and more importantly forcing them to cough up). HMRC were fine with that, less work for them.

 

10 hours ago, Wight Flight said:

The other possibility is that until the rules changed most landlords didn't actually make a taxable profit, so it wasn't worth the effort to track them down.

A combination of leverage IO BTL being a very recent thing - didnt exist til 2001ish then didnt go mental  til 2005ish

Wasnt looked into then as the booming fuckwittery bank balance sheets, stuffed full of IO debt, resi + BTL, was all part of Browns economic miracle ... until it wasnt.

Then the coalition came in and then quite a full inbox of fuckups to unfuck.

IO BTL was addressed in 2013/2014, taking a few years to work its way thru the rusty wheels of public sector., then rolled out in 2017, in stages.

~5 years is about as fast a policy usually moves.

In terms of tax owing - theres good n bad news.

Good news - for the leveraged fuckwits who make up 80% of BTL they didnt have much to pay.

The bad news -

Bad news 1) They are going to get fined for not filing a tax return since becoming a LL . The combined affect for this is going to be pricey.

HMRC have run a fill a tax return for ~2y 2019-2021.

This is standard HMRC - Do this. Or else. The Or else is coming.

 

Bad news 2) They only had no tax to pay as they were leveraged over  their eye ball.

This will work, just, when youve a 3% mortgage and 4% yield.

Different game with a yield of 3% and a mortgage of 10%

 

Bad news 3) IO BTL *HAS* been them market in a lot of places since 2004.

They have to sell to someone with no equity (paying rent for 10y) and has to take a repayment mortgage  i..e can only afford to pay 40% of hatthe LL did.

 

Bad news 4) HMRC have 20y to claim.

 

Bad news 5) HMRC will give an estimate to pay,. Itll be high, probably higher than was due, which will be a hefty sum anyhow.

Your choices at this point are 1) Pay the sum.

2) Spend several 10k hiring accountant and lawyer to pitch your case.

 

Bad news 6) Everyone think LL are scum so you wont get any support from Cons or Lab.

 

[eek]

On 25/03/2023 at 19:18, One percent said:

They are not fit for purpose. I’m on PAYE and they can’t get that right.  

Paye is best guess by your employer.

 

and hmrc don’t have to worry about speed they are happy to take their time as they just add massive fines if the tax wasn’t paid on time (as it’s the taxpayers responsibility to do things right and pay on time).

[MrXxxx]

Several recent articles have highlighted the increase costs for BTL landlords, and the 'apparent' negative implications these have for the rental market i.e. this one:

https://www.msn.com/en-gb/money/other/a-hike-in-the-base-rate-is-bad-news-for-both-mortgage-borrowers-and-renters/ar-AA1962dm?ocid=mailsignout&pc=U591&cvid=25e2635cc86644a88e3dbc81c8eecf24&ei=13

and this program on the state propaganda channel last night:

https://www.bbc.co.uk/sounds/play/m001kgrz

In addition, the latter has portrayed the landlords as the 'good' providing a societal service.

I think this may reflect the use of The Media to prime the public for a backtrack on recent BTL taxation policies, as a way to 'save'/re-juice the UK property market and avoid a crash.

[roundhouse]

Whilst not rental taxation related, here's a MSM article perhaps intended to cheer up landords (or stop them moaning about tenant power): Evict rowdy tenants in two weeks

But doesn't affect the so-called intention to end no-fault evictions. 
Also with news on an AirBnB / short let council database. Front page of the Times, from the beeb website.

https://www.bbc.co.uk/news/blogs-the-papers-65095046

[Heart's Ease]

https://twitter.com/richard_donnell/status/1641341693151551493?s=20

 

 

Edited March 30, 2023 by Heart's Ease

[Rare Bear]

On 25/03/2023 at 23:16, Wight Flight said:

This has been the case for 30 years.

If HMRC haven't bothered with the cross checks then they are not fit for purpose.

They're a public sector body so very unlikely to be fit for purpose.

[Wight Flight]

Interesting article in the impact of AirBnB

https://survivingtomorrow.org/an-open-letter-to-airbnb-8b1b58b4ad33

[AlfredTheLittle]

32 minutes ago, Wight Flight said:

Interesting article in the impact of AirBnB

https://survivingtomorrow.org/an-open-letter-to-airbnb-8b1b58b4ad33

From 2021. Hopefully rising interest rates help solve the problem.