NEW: HMRC confirms CGT property disposal rules for landlords after six-month wait

admin    Uncategorized     agents

HMRC has confirmed that landlords must file a capital gains tax (CGT) property return – even if the disposal has already been reported on a self-assessment (SA) return.

The government introduced the requirement to report disposals of UK residential property and pay the subsequent CGT within 60 days (previously 30) of completion in April 2020.

To meet the filing deadline – and given the difficulties with the CGT PPD system – many taxpayers and agents have already filed their SA return without first having filed the CGT PPD return.

The Institute of Chartered Accountants in England and Wales warns that they should file outstanding CGT returns on paper as soon as possible.

Most unsatisfactory

The accountant trade body says: “It is most unsatisfactory that it has taken HMRC almost six months to reach the decision that, where the SA return has already been filed, the CGT PPD return must still be filed, but on a paper return.

“However, this decision was somewhat inevitable. It would have been inequitable to excuse some taxpayers from the filing requirement or not to charge penalties when they have been charged to others who filed late.”

The one exception to the requirement to file a CGT return is where the SA return is filed within 60 days (or 30 days as applicable) of the completed transaction.

Read more: Complete to landlord tax for 2022/23

In most cases, a landlord will have paid the relevant tax for a disposal in 2020/21 by 31st January and interest would have stopped running when the payment was made.

ICAEW has asked that late filing penalties should take into account the six-month delay in HMRC making the decision on how the returns should be filed.

Read more about CGT rules.

View Full Article: NEW: HMRC confirms CGT property disposal rules for landlords after six-month wait

DPS report record rent increases

admin    Uncategorized     agents

The DPS has reported average rents rose £66 from £804 to £870 (8.21%) between Q2 2021 and Q2 2022.  The organisation added that four of the largest recorded quarterly rent increases since 2007, including 1.74% in Q3 2021 and 1.96% in Q4 2021

View Full Article: DPS report record rent increases

Holiday let to be taken over by golf club?

admin    Uncategorized     agents

Hello fellow hard-working property providers, We have a holiday let (5 bed 2 bathrooms) next door to where we live. Currently on Airbnb and doing well. Purchased by us (not in a company structure).

We’ve been offered the opportunity to have the (reputable) golf club across the road ‘manage it’

View Full Article: Holiday let to be taken over by golf club?

LATEST: Both landlord and property manager told to pay £24,000 RRO to tenants

admin    Uncategorized     agents

Four tenants have been awarded an equal share of a £24,000 rent repayment order despite the managing agent’s lawyer trying to discredit them during a First Tier Property Tribunal hearing.

Landlord MPL Estates and Wisteria Management must split the fine after the tribunal ruled that the unlicensed property – a three-bedroom flat in Fieldgate Street in Whitechapel, East London – was in a selective licensing area from January 2020 to January 2021.

The tribunal heard that the building was inadequately maintained; tenants cited a faulty fire alarm, broken radiator, water leaking through a ceiling light socket and a toilet which fell off the wall.

One said they had frequently asked the landlord to do repairs and that their deposit had not been returned so that at one stage the occupancy become unprotected.

unsubstantiated allegations

Mr Mohmed, representing Wisteria Management, was barred from taking part in the hearing apart from making a brief statement at the end when he made unsubstantiated allegations of fraud about the tenants and their lawyer.

The tribunal said it was not impressed by his behaviour, as he had also failed to engage with the proceedings until the day before the hearing.

Mohmed claimed he had moved house and hadn’t received the documents.

The tribunal said: “Given that he works from a business address the tribunal did not find this excuse plausible. He claimed that the property did not need a licence during the period when the tenants occupied the property but produced no evidence to support this.”

Read more about rent repayment orders.

It added: “Even if the selective scheme had not been applicable the property would still have remained licensable under additional HMO licensing given the number of occupants and the nature of the accommodation.

“Similarly, Mr Mohmed alleged damage caused to the property by the tenants but had no substantiated evidence in support of his contention.”

Read more: do you have permission to rent your property out?

Read the tribunal decision in full.

View Full Article: LATEST: Both landlord and property manager told to pay £24,000 RRO to tenants

Renters Reform Bill a ‘hand grenade’ for student let sector

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The controversial Renters Reform Bill could destroy the student-let sector. The ban on fixed-term tenancies will mean landlords can no longer guarantee spaces to new students at the start of the next academic year. Richard Reed reports.

Fixed-term lets have been the norm for university students for decades.

View Full Article: Renters Reform Bill a ‘hand grenade’ for student let sector

We would like this to be the largest landlord consultation on the Renters’ Reform Bill

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The PRS needs landlords’ views to be heard. Your responses will help identify areas of most concern in the Renters’ Reform Bill and White Paper providing evidence pinpointing the consequences of these reforms if passed unchecked. Click here

Ben Beadle

View Full Article: We would like this to be the largest landlord consultation on the Renters’ Reform Bill

‘Government’s plans to ban Section 21 evictions will lengthen evictions’ – claim

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Landlords seeking to evict tenants face more delays when Section 21 notices are abolished, warns the boss of an insurance and referencing firm.

Clogged courts and a shortage of judges and county-court bailiffs mean that cases are taking months to be heard, it is claimed.

“Imagine the frustration of waiting month after month for a hearing and then, when possession is granted, having several more months of grief as you wait for a court-appointed bailiff,” says Sim Sekhon (main pic), MD of LegalforLandlords.

“Landlords’ income has taken a massive hit, they may be in real financial difficulties themselves, but they remain at the mercy of an underfunded system.”

He believes that while housing charities spread stories about disreputable landlords, they make scant, if any, mention that some tenants are fully able to pay but deliberately exploiting the clogged legal system.

Worst affected

London is probably the worst affected, where some landlords can wait up to eight months for a hearing, particularly in Clerkenwell & Shoreditch, Barnet, Chelmsford, Central London, Willesden and Stratford Housing Court.

Plans to abolish Section 21 could make the situation even more difficult, says Sekhon, who reckons the nightmare will only get worse when every eviction requires a court hearing.

“Sometimes the landlord has made an error in the prescribed information or has failed to sort out a maintenance issue with the property,” he adds.

“However minor, these things can be enough to stop proceedings in their tracks. For the landlord hoping to regain possession, find a new tenant, settle the debts he’s accrued or catch up on buy-to-let mortgage payments, the misery goes on.”

Read more: What will happen when Section 21 evictions go?

View Full Article: ‘Government’s plans to ban Section 21 evictions will lengthen evictions’ – claim

TAX: Landlord’s plan to run rental property while living in van stumps baffled accountants

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One enterprising landlord has fallen down a tax rule black hole while attempting to work out a radical solution to making his property pay.

He wonders if it’s a good idea to buy a holiday let and live in a motorhome, using the property as his address for banking, driving licence and insurance.

After posting on our forum, LandlordZONE has spent a week trying to solve his conundrum – calling on a number of tax and financial consultants – but so far everyone has drawn a blank, either claiming it’s too complex or that it’s out of their area of expertise.

He asks: “Should I register the property as my home and pay residential council tax? If so, can I deduct my council tax and energy bills even though it’s officially my main home?

Capital gains

“And if I do this, would stamp duty be pro-rata when I sell it? If it was actually let for 200 days in the year, then would I pay 55% of the capital gains tax and then deduct 55% of the council tax as an expense and whatever energy I can reasonably claim was for business purposes?

“Should I try to register it as a furnished holiday letting, as I would be able to deduct the cost of any furniture and the stamp duty would be only 10% rather than 28%? But is it possible to do this if I don’t own any other properties?”

One landlord on the forum – DoricPixie – reckons that if you are running a holiday let business it wouldn’t be council tax that’s due, but business rates.

He adds: “Depending on the council, they might be clamping down on holiday lets and short-term rentals in the area so you’d really need to investigate that. You also need to think how you will insure the property. Pretending it’s your main home when it isn’t would likely invalidate any insurance property.”

If there are any tax experts reading this, we’d love to get your views!

Read the forum post in full.

View Full Article: TAX: Landlord’s plan to run rental property while living in van stumps baffled accountants

40% of PRS is likely to fall short of proposed minimum EPC reqiurements

admin    Uncategorized     agents

Propertymark has analysed data from the latest English Housing Survey and is warning the market that 40% of the English PRS are likely to fall short of EPC rating targets currently proposed to come into force later this decade.

View Full Article: 40% of PRS is likely to fall short of proposed minimum EPC reqiurements

Advice for Landlords: Don’t look back in anger

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Hindsight can be a wonderful thing, can’t it? When you look back at a smart decision you made and see how well it’s worked out for you. But it can also be painful, when you look back at a decision that you regret, that hasn’t worked out well at all.

Hindsight is even better when you can look back and see how well you read the signs, and how carefully you weighed your options, to make that smart decision. But it’s even more painful when you look back and see that the warnings were there all around you, and you simply ignored them and made the wrong choice as a result.

So what will hindsight hold in store for you as the landlord rental market changes radically around you and property prices start to fall? Will you be patting yourself on the back, or will you be licking your wounds?

It’s a no-brainer

“Looking back at my own decision to sell my property portfolio, I have absolutely no regrets,” says CEO of Landlord Sales Agency, David Coughlin. “I could see that the property market was reaching a peak and that profits were there to be taken. I could also see that in the post-Covid economy, those property prices were not going to last long. Add in the ever-increasing regulations on landlords and the changes to tax legislation, and selling was a no-brainer. With hindsight, it was the best decision I ever made.”

David isn’t the only one cashing in before they miss out. Landlord Sales Agency helped one Hastings landlord sell twenty-four flats for £2.256 million in just nine days. Another, who initially asked Landlord Sales Agency to sell 35 of his properties, was so pleased with the speed and simplicity of the service, that he handed over the rest of his 200+ property portfolio for them to do the same.

Time for you to sell too

As they count their cash and enjoy their freedom from the stress of the new property rental regime, they’re all looking back at a good decision, well made. The question you need to ask yourself, is what will hindsight be like for you? Will the next year bring you relief or regret?

The profits are certainly there to be taken, with markets at an all-time high, but the warning signs are there too. All the experts expect growth to slow, or even reverse in the coming months, with the potential for a property market crash, or at the very least a significant adjustment. By the time this starts to happen, it will be too late to cash in. Prices will be dropping, and if past cycles are anything to go by, they won’t be as high again for around seven years.

Cash in or pay out

Miss the boat on leaving the market and those seven years could be very expensive, as David Coughlin explains: “Given the choice between money in the bank, with the chance to lose the headaches and retire, or all the money landlords are going to have to fork out as the government makes things tighter and tighter, I’d pick cashing in every time – especially when the Landlord Sales Agency makes it so simple.”

You can join David, and dozens of other landlords who have taken their profits quickly and easily with the help of the Landlord Sales Agency. They can take on your entire portfolio and sell it within 28 days for up to 95% of the market value. Not only that, but they will take care of everything on your behalf, from dealing with existing tenants to organising any repairs and refurbishments that are needed to sell. You just sit back and wait for the money to arrive in your bank.

Given that property prices have risen by around 13% in the past year alone, it’s a small price to pay to cash in at the top of the market in such a swift and stress-free way.

How do you want to feel?

So, what will hindsight be like for you in six months’ time? Will you be kicking off your shoes on a cruise, enjoying the rewards of your past investments? Or will you be kicking yourself until you bruise, as the markets collapse around you and your costs rise every month?

“We’ve had a good run of it,” says David. “it’s now time to take the lump sum, retire and relax. There’s not much time left to sell at the best price, but you’ll have plenty of time to regret it if you don’t.”

To find out how you can cash in quickly and easily on your property portfolio, contact the Landlord Sales Agency today.

Looking back, it will be the best call you ever made.

Contact us now to find out how we can help you sell your portfolio fast.

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View Full Article: Advice for Landlords: Don’t look back in anger