Coronavirus Consent to Let Residential landlord and Taxes

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

    Coronavirus Consent to Let Residential landlord and Taxes

    Hi,
    I am a first time Landlord. I took out a Consent to Let last year when i moved in with my mum to look after her. My mortgage is on SVR. I was suppose to move back into my flat but the government issued a 3 months stay put order due to COVID-19.

    i wanted to move back in before Covid-19 so i couod remortgage as a residential landlord. I cant now. The taxes i am paying is higher because the rental income is being calculated with my normal income. I cant no longer claim for mortgage interest from HMRC as part of my deduction as that ended on the 5th April.

    With the potential extension of the stay put and tenants not having to move out or potentially pay rent, it is frustrating that accidentially landlord are being penalised with higher taxes and future CGT payments?

    My question is, is there any relief that i can apply for?

    i honestly don't think any landlord will enter or remain with all of the new regulations and higher taxes. Landlords are plugging the gaps of social housing but being penalised heavily.

    Thank you

    #2
    You can still claim for mortgage interest, it's just restricted to the base rate of tax (there's a sliding transition, so it's not that bad yet).
    So the changes only affect you if you're a higher rate tax payer (or very close to being one).
    Very few landlords are actually affected at all.

    If you have tenants in your property, you can't move in with them (unless you were living there when they became tenants.
    It's a criminal offence.

    There's no such thing as an accidental landlord (unless you inherited a property with tenants already in it).
    Any more than having a car forces you to be an accidental taxi driver.
    When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
    Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

    Comment


      #3
      it sounds like a perfect storm of bad luck there for you OP, and agree landlords get a bad time of it as of late, esepcially with tax and legislation but there isnt much you can do apart from ride it out.

      Comment


        #4
        What is your SVR now ?

        You can ask your current lender to extend "consent to let" on a residential mortgage, because of the coronavirus lockdown, you cannot move back yet.

        Comment


          #5
          There's no block on moving into a different but empty property.
          You might find it hard to get anyone to help you move, in practice.

          The problem is that the property doesn't sound empty.
          When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
          Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

          Comment


            #6
            I want to move back into my flat so I can remortgage. SVR 3.79%. I am paying £279 extra every month. I won't be able to claim this interest back next tax year. I am not a high rate taxpayer but rental income will push me into the band.
            I want to lock in a new deal as rates are low but i can't until i move back in.

            I am also concerned about Capital Gains Tax when I eventually sell. Ideally, I would have moved back into the property if my mum didn't get sick. Can i issue a section 21 notice and give 3 months notice per the new guideline? My letting agent was going to find them a new flat then the government issued a ban on moving.

            Ideally, I don't want to cause the tenants any stress but I can't afford a large tax bill especially as I only just moved back to UK. This is increasing my anxiety.

            Thank you

            Comment


              #7
              You can claim interest as an expense after next year, but it is limited to 20%.
              Only the portion of your income that is over £37,501 will be taxed at the higher rate.

              You can't move into a property occupied by tenants, unless they rent individual rooms with common areas and there's a room free.

              Yes, you can serve notice under s21 as long as all the other pre-requisites of that notice are satisfied.
              However, your tenants don't have to obey it, so your agent finding the tenants somewhere else is a better idea.

              CGT is a factor, but, even as a higher rate tax payer, it's 28% of the gain that occurred while it wasn't your residence, you still get the other 72%
              When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
              Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

              Comment


                #8
                The government did not issue a ban on people moving house. It was and is specifically permitted under the act.

                Comment

                Latest Activity

                Collapse

                • Reply to Capital Gains Tax on only property owned, let out
                  by Karen2020
                  Thanks very much Andrew for the quick reply much appreciated...
                  09-07-2020, 09:50 AM
                • Capital Gains Tax on only property owned, let out
                  by xingpot
                  I'm thinking of selling my flat and would hugely appreciate any advice on what my capital gains tax bill is likely to be.I bought the property around 8 years ago, but had to move to another city for work soon after buying (where I have lived in rented property) and have been renting my property out...
                  22-06-2020, 15:46 PM
                • Reply to Capital Gains Tax on only property owned, let out
                  by AndrewDod
                  Assuming your 67K is correct (we don't know the assumptions underlying that) "roughly" (67*7/14)-12 = 21K roughly capital gain, on which you might pay roughly £3K in tax...
                  09-07-2020, 09:39 AM
                • Reply to Capital Gains Tax on only property owned, let out
                  by Karen2020
                  Morning everybody I have a BTL that i am thinking of selling and would really appreciate some guidance on how much capital gains tax owed. I lived in the house for 7 years then let the house for the next 7 years, roughly speaking I estimate the capital gains to be around £67000, my net income is £19000...
                  09-07-2020, 09:08 AM
                • SDLT < 500k
                  by Claymore
                  Any ideas if I were to transfer/sell a BTL <£500k into a LTD Company in the next couple of months, would the transaction be covered with the no SDLT payable (announced by the chancellor today)?
                  08-07-2020, 15:48 PM
                • Reply to SDLT < 500k
                  by Gordon999
                  I watched the BBC Parliament channel this morning and noticed Rishi Sunak said the no stamp duty concession is for buyers of their MAIN home. So its not for BTL buyers.
                  09-07-2020, 07:42 AM
                • Reply to SDLT < 500k
                  by Gordon999
                  I suggest you watch the Martin Lewis show tomorrow night 8.30 itv ( Thursday )

                  https://www.moneysavingexpert.com/ne...announcement-/
                  08-07-2020, 18:48 PM
                • Reply to SDLT < 500k
                  by royw
                  No. It's 3% if it isn't your main home.
                  08-07-2020, 16:06 PM
                • Stamp duty / Tennents in common
                  by Jk2020
                  Hi,

                  I'm a first time buyer currently living with parents and looking for a buy to let, for example house worth 150K (in cash)

                  I understand i dont need to pay stamp duty (first time buyer)

                  I would then like to be tennants in common with my dad, and split it (Dad...
                  07-07-2020, 09:42 AM
                • Reply to Stamp duty / Tennents in common
                  by Gordon999
                  If the purchase is registered jointly , under yours and father's name , it means paying extra 3% sdlt.

                  Its better for you to buy under your name only and own 100% of the property, and let your father act as the "mortgage lender" to you and pay him interest at same rate as charged...
                  08-07-2020, 12:11 PM
                Working...
                X