Paul Georgian Owner

The Buy2Let Shop Limited

The Buy2Let Shop Limited is a property investment company based in London UK and deals with investors at novice/beginner level or advanced property investors. We offer professional services to vendors looking to sell their home to investors looking to build their portfolio.
The Buy2Let Shop Limited South Tower, 26 Elmfield Road Bromley BR1 1WA
020 3837 3300
6 July 2016
6 July 2016,
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In the wake of the stamp duty hikes in April, several companies are now offering ‘tax solutions’ – designed to make the most of loopholes in the law, and help landlords to avoid paying the 3% additional tax.
On paper, it’s a tempting option. However, HMRC has warned that many of these schemes are officially classified as tax avoidance – and that by using them, you’re technically breaking the law. Here’s some more information.
What Are These Tax Avoidance Services?
These tax avoidance schemes, which are deliberately targeting landlords who feel frustrated by the tax hikes, offer to cut the buy-to-let tax, in exchange for an upfront fee.
The Telegraph investigated Fiducia Wealth, a ‘tax planning’ company that offered just this – for a flat fee of £5,000. When asked, the firm stated that they could successfully avoid tax for their clients, by arguing that the house purchase qualified for legal exemption under section 48 of the Finance Act (2003).
However, when pressed, they would not confirm whether this tactic was legal or not. In instances where the tax avoidance attempt failed, Fiducia Wealth retained 50% of the fees – leaving landlords £2,500 out of pocket.
Staying Legal
When investing in property in the UK, it makes sense to stay legal – or face the consequences. A spokesperson for HMRC commented: “These kinds of schemes don’t work. We have investigated thousands of cases since 2013, bringing in over £200m in SDLT. These individuals have had to pay 100% of the original tax due, plus interest.”
In short, by avoiding tax, it’s likely you’ll be worse off in the long run. This is especially the case if you’ve also paid a company an upfront fee!
The Root of the Problem?
Part of the problem for those seeking buy-to-let property for sale is that the law is confusing. Indeed, in June, a case made the papers, regarding a buyer who paid £13,000 too much in tax, due to the fact that his solicitor had misunderstood the law. Even worse, his MP was misinformed by the Treasury, who stated the buyer would have to pay the surcharge.
Landlords across the country are concerned that they’ll be given the wrong advice about their tax bill – which leads to increased numbers of buyers trying to avoid paying it altogether.
Investing in UK Property to Rent? Read This
If you’re looking for buy-to-let property for sale, you’ll need to understand the new stamp duty taxes. Here’s a few helpful pointers.
• If you’re purchasing a property that’s not your main residence, then you’ll pay an extra 3% on the standard stamp duty taxes.
• This also applies to properties below £125,000 – which traditionally weren’t hit with stamp duty charges. Now, if your property falls below this price, you’ll pay 3%.
• It’s a rising scale – and increases in conjunction with the value of the property. For example, homes that cost between £125,001 and £250,000 will be charged at 5%. Those worth £925,001 to £1.5m will be charged at 13%.
The Buy2Let Shop
If you’re looking to invest in property in the UK, and want advice on how to find the right buy-to-let property for sale (and how to stay legal when purchasing it), talk to The Buy2Let Shop in Bromley. We’re expert property investment agents in London, and we’re on hand to ensure you find the right property investment opportunities for your requirements.
To find out more, visit The Buy2Let Shop website today.

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