As if the government debt wasn’t going to be bad enough, the banks are going to severely tighten up on the lending requirements, their margin calls, their stress test levels. Re-financing is going to become significantly more restrained. But that is just the tip of the iceberg.
Back to government debt: the billions Sunak has to recover can only be got through taxation. So firstly, be very fearful of a WEALTH TAX. The politicians are talking of a tax on the assets of the Rich: sadly the ‘Rich’ is judged as those with more than two properties!! Get your properties out of your name into a company – now.
Clearly a wealth tax would not be a vote loser. To introduce a wealth tax on the BTL industry is being openly talked about. So this is another reason to get properties out of one’s own name because it would be nigh impossible to tax corporately-owned property – a wealth tax on Peter Jones, John Lewis or the owners of Harrods?! 🤣
But sadly that’s not all. The Chancellor has just ordered a review of CGT rules, in particular, “how gains tax rates currently compare to income tax rates“? A senior analyst at AJ Bell said “the timing of such a review could spark scares of a CGT raid, aligning CGT and income tax rates“ – & then with a wealth tax imminent on assets?
Targeting the rich to pay: people with two or more properties are regarded as ‘the rich’! If you are a BTL landlord you shouldn’t be too keen on getting out of COVID because if you own property in your own name you’re public enemy number 1, 2 and 3.
If you currently run a buy-to-let business as an individual and you think you are going to be affected by the pandemic, our team at Gresh Street Partners can help you move your portfolio into a limited company. We also recommend discussing your current situation with a Chartered Tax Accountant to help you make the right decision.
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