Financial Planning Matters: No bumper gifts from the chancellor

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Jonathan Beardmore

Financial Planning Matters… a monthly insight with Jonathan Beardmore, an IFA at Pearson Solicitors and Financial Advisers.

Find out more about Pearson on their website or follow them on Facebook and Twitter. For advice on any financial matters please contact jonathan.beardmore@pearsonlegal.co.uk

Buy to Let is Not A Bumper Gift from Chancellor

THE CHANCELLOR’S wintery address was full of little pre-Christmas surprises, some nice (unless you actually worry about spending money we don’t have) and others rather naughty.

This time around cunning George unleashed his new vision of how to make life more uncomfortable for buy–to-let landlords and second home owners.

The plan is simple, like my brother in law – but unlike my brother in law this plan might work! When I say work I mean will it actually enable first time buyers get onto the housing ladder?

Let’s look at the implications first: a property costing £250,000 will now have a stamp duty hike from £2,500 to a whopping £8,800.

The basis for this change is cash buyers were unaffected by the withdrawal of tax relief on interest.

As I mentioned in a previous column I think this is just the start and until there is a huge increase in the supply of housing private landlords are going to an easy target for tax raids.

The message is simple: if you’re looking to invest money for the long term property might still be attractive. However, do politicians see it the same way?

I suggest to anyone thinking of buying a property to look at alternatives, Pensions, ISAs and unwrapped investments all offer excellent opportunities and for the most part are taxed a lot more favourably.

This government is not so much anti saving, quite the opposite. It is however anti private landlords and very opportunist, so think very carefully before telling your mates in the pub this Christmas about the “goldmine” you’ve just bought.

 

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