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I have just read this am incredulous at how far this government seems to be willing to go to stop people investing in resi property. I now give up!! Tomorrow I will be cancelling a purchase I had agreed and will not invest any further funds in resi property.
I really don't understand what the treasury/governemet expect to gain from this as it will put off many people from selling so reduce the number of transactions and result in less tax take via both CGT and SD.
Full detials available here
Not sure why the full ink didn't come out in the previous post. Let's try again@ https://www.publications.parliament.uk/pa...-pb5-l1g77
Im with you Paul I will not be buying anymore property in the uk
its just not worth the risk or the effort
I will hold what I have in my own name and company name
But for me personaly IM OUT
Learn Change and Adapt ?????
All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.
Not nice, but at first glance it appears that none of the conditions apply to my properties.
(4) Condition A is that the main purpose, or one of the main purposes, ofacquiring the land was to realise a profit or gain from disposing of theland.
(5) Condition B is that the main purpose, or one of the main purposes, ofacquiring any property deriving its value from the land was to realisea profit or gain from disposing of the land.
(6) Condition C is that the land is held as trading stock.
(7) Condition D is that (in a case where the land has been developed) themain purpose, or one of the main purposes, of developing the land wasto realise a profit or gain from disposing of the land when developed.
My former home was purchased to live in (which I did for 18 years). My main purpose for purchasing BTL properties was the income from the rent. Any capital gains were a minor consideration. Of course proving that to HMRC might be difficult, but hopefully won't be necessary as I don't plan to sell them.
My second thought is that this loks like it won't affect UK companies since they pay corporation tax either way.
My heart sank when I clicked on the link - I just can't face wading through all the gobbledegook to get to the point! Any chance someone could give me some paragraph numbers for the bits I should be paying attention to?
It is directed at non residents
This clause is part of new legislation that introduces a specific charge to tax on the profits of non-residents from a trade of dealing in or developing land in the UK.
The refers to the section that https://www.publications.parliament.uk/pa...-pb5-l1g77 begins with, but if you scroll further down to the part that begins
you will find the bit we are worried about.
Here is the equivalent document for that part - Clause 14
My reading of it is that it will include all BTL property the way it is written. I fully expect them to slide this through as they have shown time and again now that they are anti PRS. Purchase of my next BTL now cancelled as I don't wish to continue to fight against a government that is so anti landlord. I will be looking into commercial property now and other business interests.
Here's a link to property118 who have much more discussion on it and are also of the opinion it covers BTL. I'd welcome a comment from a tax expert such as RITA on this as it is a massive change.
I have asked RITA to comment.
Vanessa Warwick Landlord and Co-Founder of PropertyTribes.com **If you have got value from Property Tribes, find out how you can support it in remaining a free to use community resource**
Paul, and anyone else getting concerned, please read this a bit more carefully before you take any more pills.
As has been pointed out, this refers to non-resident companies and is simply a means to tax them under the same rules that already apply to UK companies. It does not affect companies which derive the bulk of their profits from letting property. It affects companies who buy, develop and sell land or property. There is no change - companies which do this are already subject to corporation tax, not capital gains tax, on those activities.
It doesn't affect individuals at all. The clue is in the title heading : Corporation tax.
I read with despair some of the comments on 118. A fighting fund has already been suggested! Ridiculous. Why can't people read this stuff properly before posting alarmist comments?
Not sure why you think it only refers to overseas companies and corporation tax as it clearly states "person" and "income tax". I agree it is probably aimed at overseas investors but with the wording used HMRC could easily interpret this differently. It has caused enough concern that the law society has brought the matter up. Hopefully they will reword the bill before it goes to royal consent but as it stands it is very ambiguous and far too open to interpretation.
Below is an exerpt from the finance bill:
) The persons referred to in subsection (1) are—
(a) the person acquiring, holding or developing the land,
(b) a person who is associated with the person in paragraph (a) at arelevant time, and
© 5a person who is a party to, or concerned in, an arrangementwithin subsection (3).