Tag Archives: house prices

Buy-to-Let – the tax change conundrum

There has been a rush of property transactions in recent weeks as those in the buy-to-let market try to minimise the impact of the upcoming tax changes from April 2016 and beyond. The main changes surround;- the restriction of interest tax relief on buy-to-let mortgages from the current marginal rates from 2017 to 20% by 2020, the annual wear and tear allowance of 10% scrapped and replaced with relief based on actual invoiced repairs, additional stamp duty of 3% on property purchases, (all second homes and buy-to-let properties), and the plan to apply Capital Gains Tax, (CGT), to investments within 30 days of sale. The latter is under consultation but could be implemented by 2019 and potentially would be a cash flow pressure on sellers if they were unable to mitigate gains with CGT losses.

The above, coupled with potential rises in interest rates could have a dramatic impact on those buy-to-let investors who rely on the rental income to cover the cost of loans and repairs. What were considered good profit margins on second home rentals may transform them into loss making, with a consequence that selling could become an option. Significant selling of properties in this market could have a negative impact on house prices in general, which may be seen as no bad thing for those wanting to buy either their first home or move up the property ladder.

With the Chancellors budget due in mid-March, where ratification of the April tax changes or further tinkering of tax may impact the buy-to-let market, planning for this year and the next few years should be uppermost in the minds of those with one or more properties.

Planning for your business is equally important as personal planning and sometimes the two are part of an integrated strategy.

MW Interim Finance delivers independent interim financial and business partnering support to owner managed SME’s, either on a full-time project or part-time basis, working with directors and entrepreneurs to deliver operational and strategic objectives.

For further information or a confidential discussion about your specific requirements, please contact Martin Walby FCMA CGMA on + 44 (0) 7876 566875 or email


2010 – year of the Tiger………..or was it the Pussycat ?

Yes, 2010 was not the roaring positive start to a new decade for many businesses and consumers as the UK slipped into, and technically out of, recession. Business and consumer confidence was low as the election loomed, with apprehension about the coalition government’s budget and CSR, (Comprehensive Spending Review). Interest rates remained low for the year; SME businesses stated banks were not lending with the banks saying they had the funds but few credible opportunities were presented by companies; house prices remained in the doldrums and, for first time buyers, getting on the housing ladder continued to be an issue. Standard rate VAT increases in January 2011 and retail sales are struggling at the end of 2010 with adverse weather adding to the general retrenchment by consumers. It appears that most businesses and many consumers seem to have curled up and let things pass them by this year. Is this the demeanor of a pussycat or a sleeping tiger waiting for an opportunity to pounce?

As 2011 is the year of the Rabbit,  let us hope that the government, businesses and consumers activate themselves into stimulating the economy and not run around frantically finding the nearest burrow to hide in for the year…………

Remember, procrastination means never having to make a decision, but a positive attitude will inspire, stimulate and maximise the benefits from any opportunity. For businesses wishing to review operational performance, produce or update business plans or forecasts and implement strategic change, MW Interim Finance provides independent professional finance support to achieve your objectives.  Visit www.mwinterimfinance.co.uk for further details.