Tenancy Deposit Schemes Will Pass on Info to HMRC

I’ve written previously that one of the reasons for interest in buy to let is that pensions have become less attractive as a savings vehicle following the Chancellors raid 10 years ago on the tax credit on dividends paid out to pension funds.
Of course, buy to letters will, if they know what they are doing benefit from a range of tax exemptions on capital and income taxes.
But, in due course, however, the government will come after landlords for more taxes too.
And so, it has come to pass.
Tony Levene reminds us in Saturday’s Guardian that the providers of the new Tenancy Deposit Protection schemes providers will have a duty to hand over to HM Revenue & Customs details of who is renting out property. HMRC can request this info under the Taxes Management Act 1970. Of course, HMRC will also know that the rough value of the annual rent is about 12 times the deposit.
So watch out, Gordon is on the warpath for his slice of the buy to let pie.
For Tony Levene’s full article, please see here: http://money.guardian.co.uk/weekly/story/0,,2072495,00.html
This blog is copyright of David Lawrenson 2007. Back to main site: www.lettingfocus.com

Check Those Agents' Contracts Carefully

Lots of estate agents are now busy telling people they will do a HIP for you for free. However, as Elaine Moore points out in last Saturday’s ever informative FT, there is a big catch.
She says, “If you are selling a house where the estate agent provides you with a Hip, it belongs to them - not to you.” So, if you later to to sell it with another agent, or take it off the market competely you’ll probably be hit with a pulling out fee.
As I have said before, you need to carefully check all clauses in any contract you sign with agents – be they letting agents or estate agents.
If I had a pound for every landlord who suddenly finds to his surprise that 6 months down the line his letting agent wants a fee because the tenant has renewed, I would be a richer man. (If the original tenancy contract is just renewed, there should be little if anything for the agent to do – and certainly nothing that justifies a 5% or higher fee.)
Back to main site; www.lettingfocus.com
The link to the full text of the FT’s article is here: http://www.ft.com/cms/s/55ae3f74-fa2f-11db-8bd0-000b5df10621.html
Copyright: David Lawrenson 2007.

David Lawrenson Quoted in Today's Sunday Telegraph

I was quoted in today's paper as part of a longer article on buy to let......
David Lawrenson, a buy-to-let consultant (www.lettingfocus.com), advises looking at properties with family appeal, particularly in rural or coastal areas. “Two to three-bedroom terraces have a better yield than flats,” he says. “The reality is that families are choosing to rent countrywide.” He cites immigration and job relocations as key factors in demand for rental properties.
And the future of buy-to-let? “We could be in for a rocky road, but long term it could turn out attractive,” says David. If you’re in doubt, he suggests, put an ad in the local paper for the property you’re planning to buy, saying “available to rent soon”. If you get no response, pull out.
Full article link is here: http://www.telegraph.co.uk/property/main.jhtml?xml=/property/2007/05/06/nosplit/pbuytolet106.xml
Copyright: Telegraph Newspapers 2007