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  • Section 24 HQ

    Other alternatives to company structure?

    Yesterday I went along to a presentation on the new tax changes, and explained about the use of a company structure (and paying incorporation tax instead - as I am a higher tax payer).

    Have many done this yet? Is it a good option even taking into account CGT, and then stamp duty surcharges? Could the government just stop this "loophole"?

    Just don't want to rush into this and get burnt.

    Be great to here peoples experiences, or any other clever alternatives?

    (*Moderator note:  See this related thread - Ltd Co is the worse possible way to own BTL? *).

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    I stayed put partially because of the fear they would move the goalposts again

    More so though because  the costs to move over for me was unfavourably high

    Some shifted across and paid those  costs -  so yes could get burnt

    I went on the offensive and bought more

    The extra income  pays the extra tax

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    Jonathan Clarke. http://www.buytoletmk.com


    Same here Jonathan. Have you considered the LLP/ hybrid structure in future? I'm feeling drawn to that model.

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    I have considered it yes but again for now I`m staying put in case they introduce additional measures

    I dont like stuff i dont fully understand and HMRC may attack that model as well

    Also it makes me nervous when  I find that seemingly very knowledgeable tax  brains  cannot agree 100% either

    HMRC are all powerful so their interpretation would out trump the average  tax advisors interpretation

    One would have to have deep pockets to challenge the stance  they take

    They have already demonstrated their ability to go up against all normal held  interpretations of accounting rules

    The thought of the effort and cost to change wholesale does not sit well with me

    So I`m not sleep walking into a problem but just using the time to watch and wait and tinker

    I stress test for my extra  24 tax bill   + a 5% rise in interest rates + a 20% drop in prices

    Whilst its not pretty I will survive and still be better off than when i started  this roller coaster ride

    If I was at the start or middle of building a portfolio I would give it more attention I expect

    But as i am at the end I can afford a little leeway before deciding to do something or indeed do nothing

    My procrastinators option is always in my  back pocket and appeals on some days

    And that is to sell half and pay down on the other half

    But the thought of losing all that income and capital growth in the years ahead stops me picking up the phone

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    Jonathan Clarke. http://www.buytoletmk.com


    Jonathan your strategy of buying more properties to pay the tax is a good one except you now have more properties to look after .


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    Yes agreed - The time  factor with one or two more though is a relatively  minor factor I feel

    I like to think my systems are fairly streamlined and efficient now

    So the advantages for me sharply outweighed the disadvantages

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    Jonathan Clarke. http://www.buytoletmk.com

    I am thinking of buying more property if I stay in the UK but i am also thinking of selling half my properties and moving overseas to most likely portugal.

    There is no inheritance tax to pay in Portugal so the benefits are better weather, fewer people cheap cost of living and less property to manage.That means more free time to enjoy myself rather than answering the phone and I can pass my wealth to my family without having to worry about the tax man.

    They also dont discriminate against landlords and grab businesses that have taken 20 years to develop or pretend that BTL is the same as stocks and shares

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    Your Not alone Bill I am thinking of doing the same thing

    why give 40% of what you have worked for to HMRC when you don't have too

    I am going to become an Ethnic Minority in someone else's  country

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    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.


    There are a few comments on this on the "Is S24 deterring newbies from BTL thread"

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    I own Both

    with S24 my tax bill would have gone up four times higher than last year so the headline rate of income tax would have been around 75%

    I was not prepared to pay such high tax

    so I have moved some property but even then If I was to take a Salary or Dividends the rate would still be over 50%

    The Company serves me well with succession and paying into a directors pension and paying my wife a salary who is a basic rate tax payer

    But at the end of the day its better than paying 75% with S24




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    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.