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Chancellor's Autumn Budget November 2022


Melboy

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He should have held this Autumn budget on November 5th as it is all a bit of a damp squib.¬†¬†ūüėÖ

The only really clear statement that affects us Landlord's is the dramatic drop in Capital Gains Tax relief from £12,500 to a very lowly £3,000.    It was widely expected to be a drop to £6,000. Still, it is only a problem if you need or want to sell your rental property and for me personally I don't.

Stamp duty changes in 2025 as well.

I do expect there will hidden tax rises which have not been revealed.

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Well I watched the Chancellors Budget.  As I thought he didn't mention Item 61 in the budget papers at the dispatch box.  Fuel duty to rise by 23% next March which will add 12p a litre to a litre of petrol. Probably didn't have the guts to say this.

Just imagine what that will do to inflation!

All in all I thought it was a pretty poor budget considering the dilemma the Country is in right now financially.

CGT now a £3,000 threshold tax relief, down from £12,500  No real surprise there. Always hit the people who support the Tories. This Budget was more Labour than Conservative.

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Individual CGT allowance currently £12300....... drops to £6000 in April 2023 and....... drops further to £3000 in April 2024.

By my calculations that adds an extra £1764 to the CGT tax bill in 2023/24 and a further £840 in 2024/25.

Still, our 10.1% triple lock, double state pension increase along with our ¬£500 winter fuel allowance & ¬£400¬† energy payment will cover that ūüėÉūüėÉ......thanks Rishi.

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I am not sure why you will be getting £500 Winter fuel allowance RL as in my letter states it will be £300 per pensioner household which is as stated by Gov.UK

The 'Winter Fuel Payment'. The amount you'll get includes a 'Pensioner Cost of Living Payment'. This is between £150 and £300. You'll only get this extra amount in winter 2022 to 2023.

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There are two of us. We get an extra £150 winter fuel allowance each together with the existing £100 allowance each which equals £500 in total. We've already had letters telling us to expect our £250 each.

Looking at the bigger picture........the Conservatives seem to be taking a completely different view & route to dealing with borrowings.  One question that doesn't seem to be answered is WHY when the UK borrowing is lower than most other industrialised countries have they decided to raise interest rates heading into a recession. None of the other major economies have decided to do that. It doesn't make sense to me.

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5 hours ago, Richlist said:

One question that doesn't seem to be answered is WHY when the UK borrowing is lower than most other industrialised countries have they decided to raise interest rates heading into a recession. None of the other major economies have decided to do that. It doesn't make sense to me.

They're hoping to fend off inflation.

That's the inflation that is in no small part due to the borrowing to save us from covid, by pushing money into the economy 1930's Germany style.

It's possible that the Gov't are also attempting to restore some faith lost by the money markets during the Kwarteng / Truss short era.

 

I want to sell more and really dislike losing more in CGT. From what I understand this reduced threshold will affect more than just property exinvestors, but our incentives to invest have been hit hard already. Do investors consider the tax burden when investing, I'm not sure.

The main question from that is will it deter future investment in the UK? Maybe that will depend on what else, or where else, looks good. But I do recall a previous Davos policy was for advanced nations to have unified tax strategies, so reducing the tax haven possibilities. Not sure if that would include Panama and the like though.

The one that will, I feel, cripple the economy is a 12p pl tax addition to ICE fuel. Methinks the knock on from that would stall the economy and accelerate the depression significantly.

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1 hour ago, Carryon Regardless said:

The main question from that is will it deter future investment in the UK? Maybe that will depend on what else, or where else, looks good. 

That is THE question. Who in their right mind would start a new business in the UK now given all of the negative financials. Look at the negatives.....painfully high...... rents, business rates, energy costs, corporation tax, dividends, import duties and then on top of all that the public have less disposable income to spend on goods.

I'm usually quite upbeat during a downturn in the economy. I've always been able to remain optimistic & hopeful that I will be able to recognise a few opportunities that will do well. Let hope I can maintain my positive outlook.

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54 minutes ago, Richlist said:

I will be able to recognise a few opportunities

Please divulge when you have.

I saw Russia in the early days of Putin. The males suffered so much apathy from the Soviet collapse and financial 'what's the point' era, alcohol being cheap became widely used. I wonder, if to compound the depression were said to be in, we will see much of that apathy also.

Keeping an affordable car on the road is becoming more difficult.

Using it is much more expensive.

Food and heat are, well you know.

If we have income (from gainful efforts) there is to be less left for us.

AS you say RL being in business is much more expensive, legislation continues to add to the overheads.

And the rights of the consumer mean the risks are massively higher then was.

Still it'll be summer again soon, ish.

 

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The one thing that is crystal clear is that any small business is going to get a hammering. Corporation Tax, Dividend Tax, Council Tax, Business Rates, cost of ALL raw materials no matter what your business is and for those with employee's a rise in the living wage all going sky high. As for your local pub it is unlikely the community hub will be able to survive this recession.

I live in a village and the Pub closed down in 2009 due to the economic situation for 2 years but was eventually rescued and brought back to life and up until the Covid Crisis was recovering quite well but now it is struggling to survive again. I have a feeling the doors will be closing very shortly after Christmas.

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On 11/18/2022 at 7:06 AM, Melboy said:

I am not sure why you will be getting £500 Winter fuel allowance RL as in my letter states it will be £300 per pensioner household which is as stated by Gov.UK

The 'Winter Fuel Payment'. The amount you'll get includes a 'Pensioner Cost of Living Payment'. This is between £150 and £300. You'll only get this extra amount in winter 2022 to 2023.

Just to make it clearer.

 

Born between 26 September 1942 and 25 September 1956

Born on or before 25 September 1942

You qualify and live alone (or none of the people you live with qualify)

£500

£600

You qualify and live with someone under 80 who also qualifies

£250

£350

You qualify and live with someone 80 or over who also qualifies

£250

£300

You qualify, live in a care home and do not get certain benefits

£250

£300
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  • 1 month later...

Latest offering from Money Mail on the current situation.  I must admit I am surprised anybody would want to enter the BtL market right now and if they did it would be a bold move indeed given what is going on.

Perhaps long term experienced landlord's may not be too badly affected but the decrease in CG allowance is slightly worrying and I would imagine a landlord with one or two properties may take the money and run before the Capital Gains Allowance drops from £12,300 to £6,000 in April 2023 and then down to £3,000 in April 2024.

I do personally know of one landlord friend of mine who is selling up and getting out of the business after 15 years so that will be 2 more families joining the rental/social housing queue shortly. I would imagine you could multiply this scene by the thousands around the Country very shortly.

All these anti Landlord policies by this Conservative Government will surely back-fire on them as the rental housing situation worsens over time. Perhaps their biggest mistake was taking the chain off Jeremy Hunt from the back benches and putting him back into the second most powerful position in Government.

Anyway have a read and see how you fit into this planned attack on private landlords.

https://www.thisismoney.co.uk/money/buytolet/article-11569067/Changes-landlords-2023-End-no-fault-evictions-lower-margins

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