Please Note: This Article is 6 years old. This increases the likelihood that some or all of it's content is now outdated.

Buy to let landlords should fork out an investment tax of 22% a year on top of any taxes they already pay to help fund the building of social housing, a think-tank has announced.

Generation Rent, funded by the Nationwide Building Society, has launched a petition to garner support for their proposal.

The Nationwide is a major funder of buy to let mortgages through their brand The Mortgage Works.

Generation rent claims landlords are subsidised by £27 billion of housing benefits and tax while generating rents and capital gains of £77.7 billion every year.

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On top of the income tax and capital gains tax paid, the think-tank wants to raise an extra £9.3 billion a year from property investors to finance house building by local authorities.

They reckon this could pay for 90,000 homes every year.

The target is to reduce the nation’s reliance on private landlords, to cut housing benefit and to bring down the cost of rents.

The report also claims landlords can claim 10% of their rental income tax-free for wear and tear without showing that they have made any repairs.

This is inaccurate – the wear and tear allowance only applies to fully furnished lettings.

“During this age of austerity, landlords have made a colossal amount of money from capital gains and rents, and enjoyed generous subsidies while their tenants face stagnant wages and cuts to the welfare state,” said a Generation Rent spokesman.

“People who work for a living are funding through their taxes the lifestyles of people who can make a living simply because they own property and someone else doesn’t.

“To redress the balance, the government can use the tax system to redress the balance and make sure landlords pay their fair share. While the value of the missing income and capital gains tax will fluctuate year by year, the annual outlay of £9.3bn in housing benefit shows no sign of going away.”

The think-tank proposes that a national register of private landlords would be needed to help collect the levy and to police rogue landlords who avoid registration.

Landlords who failed to pay the levy would be charged additional penalties, the spokesman added.

 
 
UPDATE 12/02/2015 – Nationwide Responds to LandlordZONE(See Tweet Below)

“That’s incorrect. Generation Rent receives funding from Nationwide Foundation, an independent charity http://www.nationwidefoundation.org.uk.

We are Foundation’s main benefactor, but funding decisions are made by Foundation’s Board of Trustees, which is independent.

We do not endorse the organisations funded by the Foundation but we respect its right to create its own strategy.”

Nationwide Press – @NationwidePress

 

 

Please Note: This Article is 6 years old. This increases the likelihood that some or all of it's content is now outdated.
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11 COMMENTS

  1. \”people who work for a living\”,im sure they will find most private landlords work for a living as well ,but have property to help towards a pension instead of giving the money to some faceless fund manager who takes a large chunk of whats paid in regardless of how well they have performed.

  2. Stupidity at its worst. You will either have no landlords, as they will have sold up and left the business or for those landlords that remain, they will have to hike up the rents to make the business pay and the expense of the tenant.
    There are too many dangerous people trying to think!!

    • So what happens to all the properties the LLs sell? Do they get bought at fire sale prices by owner occupiers? Sounds good to me.

  3. I can\’t believe that adding more costs and red tape will do anything to help the tenants of these buy to lets I will be issuing 2 months notice and then selling the property. The local government can house these so called hard workers while I move to Spain to watch The country fall deeper into the brown stuff.

  4. Well there\’s little wonder the country is in such a mess with these idiots trying their best to bite the hand that feeds them! There is clearly no reward for those of us who have worked hard, been taxed every which way & tried to plan our financial futures w/out relying on handouts Would be great to get some support to redress the scuffers who abscond w/out paying their rent, repairing their damage & even stealing our property, funny how these people ignore these joys of being a landlord. Maybe we should all just sell up & join Wayne in Spain and enjoy the labours of our hard work.

  5. The situation now is that BTL is tax advantaged when compared to someone trying to buy a house to live in and call a home. It needs to stop. This won\’t happen as there are too many people in power that are in the rentier class. What percentage of MPs own BTL portfolios? The system is rotten and undemocratic.

  6. Rather than an additional tax on buy to let just remove the tax relief on interest only. That would address the imbalance with first time buyers and reduce landlords tax avoidance.

  7. 1)\”w/out relying on handouts\”

    You see, that\’s the trick, with all the subsidies and tax breaks landlords get they\’re actually relying on handouts, because without them BtL wouldn\’t be nearly as profitable as it is.

    2) \” Maybe we should all just sell up & join Wayne in Spain and enjoy the labours of our hard work.\”

    Please do, if you all do it at the same time prices will drop, and all the people who are sick of renting – essentially paying someone else\’s mortgage – and want to buy a place to live in (not a retirement fund) will be able to do so.

  8. Ridiculous right of entitlement from current landlords on this site who have benefitted from being in the right place at the right time as well as a disgraceful ponzi scheme initiated by our central bank which has seen the price of your assets soar.
    Property prices have become out of reach for ordinary 20 somethings who despite what some of your comments say DO work hard and many then sacrifice 50% or more in some cases of after tax earnings to line your pockets.
    I for one would love it if many greedy property investors were forced to sell up as the market prices would be forced down through excess supply. Houses should be for living in, not treated as assets and a way to bleed the younger generation dry.

  9. Social housing for who?
    Mostly Min wage imported cheap labour
    The average house lasts 100 years. Therefore the normal replacement rate is very low in a static population.

    The social housing queue in Southampton has expanded become nine years long since Gordon \’British jobs and homes for Polish workers\’ Brown opened the floodgates in 2004.
    Every other name on the maternity unit costs is East European.

    And most of these low wage migrants qualify for more \’in work\’ benefits than they pay in tax
    Such as working family tax credits, housing allowance, NHS etc etc

    The only beneficiaries of this mass immigration are low wage employers. We are subsidising their work force.

    For the pleasure of this we have to put up up with rising rents & house prices & wages driven down

    The EU is one giant corporatist dump on ordinary British people

    Yet the left support it !
    Bizzarre

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