‘Give property sellers more time to pay their CGT’ says official report

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An official review of the Capital Gains Tax (GGT) has recommended that those selling property should be given 60 rather than 30 days to report and pay their CGT or that estate agents and conveyancers should mandated to distribute information to their clients about the tax.

This is the recommendation from the Office of Tax Simplification (OTS), which has now published its second report on CGT following initial recommendations published in November last year.

This would give the 150,000 people who report their property sale to the tax authorities each year more time to work out if they are due to pay CGT, and for the 85,000 who are usually liable to pay it more time to file their UK Property tax return.

“The former approach would simply create a longer window, and the latter more subtly by making taxpayers aware of their obligations earlier on and so giving them more time to prepare in advance of the sale,” its report says.

“The predicted cash flow effect on the Exchequer in the 2021-22 tax year of extending the deadline to 60 days in estimated to be approximately £105 million.

“The cost would come down significantly in subsequent tax years, and this figure needs to be considered in the context of the £935 million that this policy change raised in tax year 2020-21.”

Chris Norris, Policy Director (pictured) of the National Residential Landlords Association says: “Landlords should always ensure they meet all legally required deadlines to pay tax.

“That said, today’s report from the Office for Tax Simplification demonstrates a woeful lack of communication and consideration by HMRC about what is expected of those liable for the tax.

“It adds weight to the argument that the seemingly arbitrary, 30-day deadline has created more problems than it solves.  We would support the OTS in recommending an extension to 60 days to avoid landlords missing a shorter deadline, potentially through no fault of their own.”

There are three main ways of reporting a capital gain – through Self Assessment, the UK Property tax return, and the ‘real time’ Capital Gains Tax service.

The OTS has recommended changes to each of these but the” overarching recommendation is that these should be brought together in the Single Customer Account”.

Read the report in full.

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Charity now working with five councils to help tenants ‘get tough’ on rogue landlords

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Campaigning group Generation Rent has joined forces with five local authorities to help private tenants stand up for their rental rights and get tough on rogue landlords.

It is partnering with Dundee City Council, East Suffolk Council, Gedling Borough Council, London borough of Newham, and Newport City Council to find ways the councils can be more responsive to issues and concerns, and to develop policies to better support renters, such as through enforcement or landlord licensing.

It says that while many councils around the country have landlord forums, very few have formal structures to hear from private renters.

Councils have powers to tackle unsafe homes but, according to a Survation poll, when asked what they would do if their home felt unfit to live in, private renters were more likely to try to find somewhere else to live (44%) than seek the council’s help (35%).

Alicia Kennedy (pictured, top), director of Generation Rent, says: “These local authorities have recognised the important role councils play in supporting private renters, and now want to improve the way they represent and engage private renters.

“We hope this joint work will develop new models of engagement that can be shared and built upon by other local authorities.”

Key issues

Gedling Council aims to gain a better understanding of the key issues private renters are facing, says council leader John Clarke: “We’re already working with landlords on this through our selective licensing scheme, but it’s vital that we also engage with residents who are renting these properties, to get their views and plan how we can improve our services for them.”

Renters in these areas are being asked to take part in an online survey to share their renting experiences in the project which is funded by the Joseph Rowntree Reform Trust.

Read more about Generation Rent.

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Landlords: Get ready for torrential downpours and strong winds

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We may have avoided the April showers this year, but May is more than making up for it. Many parts of the UK have already seen in excess of double their normal rainfall for the whole month as torrential rain has swept across the country. In the short term at least, the weather is stuck in an unsettled, turbulent pattern.

With more drenching downpours and thunderstorms forecast this week, the Government has issued a number of flood alerts and the Met Office has weather warnings in force for strong winds in the south and south west of England on Thursday and Friday.  

Steve Barnes (pictured), Associate Director at Hamilton Fraser Total Landlord Insurance, is urging landlords to be prepared:

“During periods of unsettled weather like we are experiencing at the moment, with water levels already very high and more rainfall forecast, as well as strong winds, preparation is everything. If you take the right preventative measures and have comprehensive landlord insurance in place, you can be confident that you’re doing all you can to protect your tenants and your business. It’s also really important to communicate with your tenants.

Ask them to alert you to any repairs that might put your property at greater risk of damage, and make sure they know what to do if your property is affected by flooding or storm damage. Landlords with high-risk properties should prioritise investing in home improvements as well as increasing their insurance protection.”  

Prepare for flooding by planning ahead

With river levels having risen in parts of the UK, such as on the River Wey, as a result of sustained heavy rainfall, flash floods are possible in certain areas. According to the most recent CCRA report, an estimated 1.8 million people are living in areas of the UK that are at significant risk of coastal, surface or river flooding. 

But it’s important to realise that it’s not just properties in riverside or coastal areas that are susceptible to flooding.

Severe flooding can happen without warning as heavy rain, particularly on already saturated ground, can lead to rising groundwater causing burst water mains and backed-up sewers, resulting in surface water that could have a devastating impact almost anywhere, making properties completely uninhabitable and leading to serious repercussions for landlords and tenants.

Last year the Environment Agency launched a campaign to highlight the impact of flood damage on mental health, advising people of the importance of signing up to flood alerts. Low income households are amongst the most at risk of flooding and 61% of low-income renters don’t have home contents insurance.

It’s important as a landlord that you do all you can to protect both your property and your tenants, by taking the following steps:

Although floods can happen anywhere, it’s worth finding out if you’re at high risk. This should be your first step. Enter your postcode to find out if you’re in an area at risk from flooding

• Forewarned is forearmed – make sure you sign up for flood warnings. These will warn you of the risk of flooding from rivers, the sea and groundwater. You’ll be alerted by phone, email or text when flooding is expected

• Prepare your tenants – provide all tenants in at-risk areas with a decent supply of sandbags and make sure tenants always inform you if repairs are needed so that you can minimise the risk of damage in severe weather. In the event of a flood, make sure your tenants know what to do – for example, how to turn off the gas, electricity and water

• If your property is in a high risk area, it is worth taking extra precautions to minimise flood damage:
• Raising the height of electrical sockets on the ground floor and raising electrical goods above the floor on high shelves or wall mounts 
• Replacing wooden window frames with more durable UPVC
• Waterproofing the doors and skirting boards, as when wood gets wet it can rot
• Fitting waterproof ceramic or stone flooring rather than wooden boards and carpets
• Sealing around external doors and windows

• Check your insurance – make sure your landlord buildings and contents insurance includes flood damage and make sure your tenant knows that it’s their responsibility to protect their belongings with their own contents insurance

Find out more in Hamilton Fraser Total Landlord Insurance’s comprehensive guide, Measures that must be taken to prevent flooding in your properties.

Prepare for strong winds

With strong winds forecast in some areas as well as more heavy rain, landlords should also be making sure their properties are protected from storms. The most common hazards associated with storms are roof tiles cracking, trees falling, flooding and fences collapsing. Over the past five years, 71% of Hamilton Fraser Total Landlord Insurance’s storm claims have been for roof damage, with an average claim of £1,154, typically as a result of high winds causing tiles to fall off the roof.

If you’re unable to access your property yourself, you should contact your tenant to check that everything is in order and secure. Here are some tips to help you prepare your property to limit the impact:

• Check loose roof tiles and guttering
• Secure loose objects such as ladders, garden furniture, plant pots, children’s toys or anything else that could be blown into windows or cause other damage in high winds

• Store lawnmowers and other electrical garden items away to prevent them from getting damaged
• Reinforce windows if a very severe storm is predicted – plywood is a cost-effective way to do this
• Make sure tenants close and securely fasten all windows and doors

You can find out more in Hamilton Fraser Total Landlord Insurance’s guide, Protecting your rental property from storms.

With this unsettled weather set to continue over the next few days, landlords should make sure they keep an eye on the weather so that they can assess their level of risk and be sure to check in with their tenants. Taking emergency preventative measures will reduce the risk of damage to your property, as well as helping protect your tenants and passers-by, for example in the event of a roof tile coming loose, falling off your property and causing damage or injury.

As a valued LandlordZONE reader you’re entitled to 20% off Hamilton Fraser Total Landlord Insurance’s policies, call the team today on 0800 63 43 880 quoting code LZ2021 or get a quote online in under 4 minutes. 

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I want to help my wonderful tenant moving to Exeter

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Hi, my tenant is currently in N. Wales, single educated lady with 2 dachshunds and working as a teacher. She is moving to the Exeter/Devon area after 16 June and cannot find a property.

She has been a wonderful tenant for 3 years with no issues

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Landlord fined over unlicenced ‘hot-bed’ HMO used by 20 Romanian shift workers

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A rogue landlord has been fined for allowing 20 people to live in her unlicensed HMO.

Siddika Begum, of Hawthorn Close in Salisbury, admitted the offence, as well as falsifying information and failing to provide gas, electrical and fire safety certificates for the property – also in Hawthorn Close.

Swindon Magistrates Court heard that the three-storey house in a residential road was continually occupied from March 2019 to September 2020 by up to 20 Romanian adults and their children, many of whom were local shift workers using it to ‘hot-bed’. 

Wiltshire Council reported that the property was overcrowded and unregulated. Not only did it pose a potential health and safety risk to the occupants, but the neighbours were also impacted by significant levels of anti-social behaviour, large amounts of domestic waste causing rats, together with fly tipping and various motor offences including a large number of unpaid parking fines. 

During the investigation, Begum denied that the property was being used as an HMO and claimed she lived there with a couple of friends, despite evidence to the contrary. She was fined £3,104 and ordered to pay costs of £1,224, plus a victim surcharge.

Councillor Phil Alford, cabinet member for housing says: “The evidence required to take this case to prosecution couldn’t have been achieved without the assistance of many different agencies, including Wiltshire Police and was particularly challenging given the Coronavirus situation at the time.”

Read more news about HMO licensing.

Read more about licensing HMOs.

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EICRs From Hell?

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I have a rented property with no problems from the electrics over a 10-year period. I had an EICR carried out in December 2011 that was satisfactory. A week ago the electrician EICR checked the house and found some minor problems with the earths plus the need for a new consumer unit and left.

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DWP will conduct checks to verify or withdraw post Covid UC claims

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People who applied for Universal Credit as Covid hit could be subject to a benefits check by the Department for Work and Pensions (DWP). Citizens Advice sets out the need-to-knows on the DWP’s Trust and Protect scheme, and the steps that should be taken to ensure benefits are not withdrawn.

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Labour launches all-out assault on government’s private rented sector policies

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New shadow housing minister Lucy Powell has taken aim at the government’s failure to protect renters, leaseholders, first-time buyers and local communities, in her maiden speech in the role.

During a debate on affordable and safe housing, she told the Commons that its housing policies had failed.

“Now, more people are living in expensive poor-quality rented housing, subsidised by a soaring housing benefit bill,” said Powell.

The recent Queen’s Speech had done nothing for renters living in, “overpriced, poor-quality homes, thousands of whom are on the brink of eviction”, she said, while it had also neglected to include measures for those stuck on council waiting lists because right-to-buy properties were not being replaced, nor had it done anything to address the climate emergency after its flagship Green Homes grant was dropped.

Added Powell: “Ministers have taken some welcome action, such as the moratorium on evictions, but alongside housing charities, I am deeply concerned that the rolling back of those protections will now lead to a wave of homelessness.”

During the debate, fellow Labour senior Rebecca Long-Bailey (pictured) said that although the government had reaffirmed commitments to end section 21 no fault evictions, this had taken more than two years.

She added: “If the government honour their promise, that still leaves a glaring lack of protection for all those tenants in pandemic arrears who can still legitimately be evicted.

“The government should have set out a package of support for them.”

Powell also introduced an amendment pointing out that the Queen’s Speech failed to prevent the potentially ruinous costs of remediation works to make buildings safe being passed on to leaseholders and tenants and called on the government to set a deadline of June 2022 to make all homes safe. The amendment was rejected, 358 votes to 223.

Read: Who is Lucy Powell?

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Management company director from hell?

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I’ve been a joint shareholder of a freehold company that owns a Victorian block with 4 flats for about 5 years, there are four flats with four shareholders, and I am one of three Directors running the management company.

The other two Directors are ‘Directors from Hell’

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COVID: Fraudulent tenant applications jump as renters dodge referencing

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Growing numbers of amateur scammers led to a 263% rise in the value of fraudulent tenant applications during the past three months, reports due diligence and guarantee firm Homeppl.

It says that if left unchecked, this severely impacts landlords and estate agents leading to potential long-term periods of rent or property damage.

Its fraud detection tests identified that 2% of all tenant applications were fraudulent in the first quarter, with the value of these applications three and a half times higher than Q4 last year.

One in 50 of all tenant applications handled by Homeppl was fraudulent and, in parts of London where properties fell into the high value bracket, this rose to one in 20 of all applications.

In these locations, it often uncovers professional fraud, when the tenant tries to take possession of a high value property and sublet it through short-let sites such as Airbnb to maximise income while defaulting on the rent to the landlord.

CEO and founder Alexander Siedes (pictured) says common techniques used by amateur fraudsters are fake IDs – including passports and driving licences – and doctored documentation including payslips, bank statements, letters of employment, proof of address and proof of study, as well as fake email and websites to mimic employers and references.

He says: “Amateur fraud occurs when tenants aren’t earning enough to afford the property and this type of activity seems to have risen as a result of the pandemic which could be due to tenants being on furlough or losing their jobs.”  

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