Work starts on the eagerly awaited new Foxtons office on Brixton Road

[Dexter Deadwood]

Which tax relief is this?

What is Tax Relief for Mortgage Interest on a Home Loan?
Tax relief for mortgage interest on a home loan is tax relief given to mortgage holders based on the interest paid on a qualifying mortgage on your home i.e. a new mortgage for a home, a top up loan used for the purposes of developing or improving your home, a separate home improvement loan, a re-mortgage or a consolidation of existing qualifying loans [i.e. loans used for the purchase, repair or improvement of your home], secured on the deeds of the home.
http://www.revenue.ie/en/tax/it/leaflets/tax-relief-source-mortgage-interest-relief.html#section1

 

[TruXta]

What is Tax Relief for Mortgage Interest on a Home Loan?
Tax relief for mortgage interest on a home loan is tax relief given to mortgage holders based on the interest paid on a qualifying mortgage on your home i.e. a new mortgage for a home, a top up loan used for the purposes of developing or improving your home, a separate home improvement loan, a re-mortgage or a consolidation of existing qualifying loans [i.e. loans used for the purchase, repair or improvement of your home], secured on the deeds of the home.

???

From HMRC

Mortgage interest relief - introductory note
Relief on mortgage interest repayments was removed on 6 April 2000. Mortgage interest relief for those aged 65 and over who take out loans to buy a life annuity (a home income plan) ended with effect from 9 March 1999, but existing loans will continue to qualify for the remainder of the loan period.

http://www.hmrc.gov.uk/statistics/mortgage.htm

 

[leanderman]

Introduced by Labour in 69 and abolished in 88 by Nigel Lawson.

Miras was still around under Labour, until 2000

 

[TruXta]

What is Tax Relief for Mortgage Interest on a Home Loan?
Tax relief for mortgage interest on a home loan is tax relief given to mortgage holders based on the interest paid on a qualifying mortgage on your home i.e. a new mortgage for a home, a top up loan used for the purposes of developing or improving your home, a separate home improvement loan, a re-mortgage or a consolidation of existing qualifying loans [i.e. loans used for the purchase, repair or improvement of your home], secured on the deeds of the home.

You're quoting the Irish Revenue there, Dexter.

 

[leanderman]

The problem is mortgage interest relief for landlords.

As I have pointed out here dozens of times

 

[Rushy]

The only thing there which is tax deductible is interest on qualifying loans. A qualifying loan is funds which you have borrowed against the value of your home in order to invest in your business, whatever that may be.

 

[Dexter Deadwood]

You're quoting the Irish Revenue there, Dexter.

Fuck

 

[Dexter Deadwood]

The only thing there which is tax deductible is interest on qualifying loans. A qualifying loan is funds which you have borrowed against the value of your home in order to invest in your business, whatever that may be.

Well that should be abolished.

 

[Rushy]

Well that should be abolished.

Why should the cost of a business loan not be tax deductible? It is a business cost. Lots of people starting businesses risk their homes by raising capital against them. E.g. a plumber who needs equipment or a van to start out on his own. Or someone trading nuts and bolts (I use that as an example because I know someone who started their business doing this) needs to buy stock. It's hard enough for businesses to get finance as it is. What you are suggesting would mean small businesses could be paying tax even if they were losing money - making it even harder than it already is to start a bsuiness. Brilliant!

 

[leanderman]

Why should the cost of a business loan not be tax deductible? It is a business cost. Lots of people starting businesses risk their homes by raising capital against them. E.g. a plumber who needs equipment or a van to start out on his own. Or someone trading nuts and bolts (I use that as an example because I know someone who started their business doing this) needs to buy stock. It's hard enough for businesses to get finance as it is. What you are suggesting would mean small businesses could be paying tax even if they were losing money - making it even harder than it already is to start a bsuiness. Brilliant!

A business loan is reasonable - but tax breaks on a loan used to speculate on property are something else.

And are a major factor in the rise of buy to let.

 

[Dexter Deadwood]

Why should the cost of a business loan not be tax deductible? It is a business cost. Lots of people starting businesses risk their homes by raising capital against them. E.g. a plumber who needs equipment or a van to start out on his own. Or someone trading nuts and bolts (I use that as an example because I know someone who started their business doing this) needs to buy stock. It's hard enough for businesses to get finance as it is. What you are suggesting would mean small businesses could be paying tax even if they were losing money - making it even harder than it already is to start a bsuiness. Brilliant!

That's the risk you take in a free market. Another fault of the free market is despite the bailouts, the quantative easing, the casino banks are still not lending. The profits get privatised and the losses externalised. There has to be a better way of doing things. Proponents of neoliberalism would also argue against you saying imperfections in the market are caused by state intervention.

 

[Manter]

Well that should be abolished.

It's designed to encourage small businesses- so if I am setting up a little shop or manufacturing firm or whatever, I can secure the loan I need to start up- or expand- against my house. Some people's businesses are property businesses so contributing to the problem, but many people are using/risking their properties to do 'real' things, iyswim.

 

[Dexter Deadwood]

It's designed to encourage small businesses- so if I am setting up a little shop or manufacturing firm or whatever, I can secure the loan I need to start up- or expand- against my house. Some people's businesses are property businesses so contributing to the problem, but many people are using/risking their properties to do 'real' things, iyswim.

But the interest is tax deductible and it shouldn't be.

 

[Rushy]

But the interest is tax deductible and it shouldn't be.

It is a business cost. Just like renting an office or paying for staff. Why should it not be tax deductible?

What you suggest would give advantage to companies who don't need finance - usually bigger more established companies.

 

[Manter]

But the interest is tax deductible and it shouldn't be.

Why not? It's to encourage people to do it- so rather than sitting on a house as a dead asset, you use it to provide jobs and get money into the economy?

 

[Dexter Deadwood]

It is a business cost. Just like renting an office or paying for staff. Why should it not be tax deductible?

What you suggest would give advantage to companies who don't need finance - usually bigger more established companies.

Why should the taxpayer pay for business costs?

 

[Rushy]

Why should the taxpayer pay for business costs?

How so? What you are suggesting is making people pay tax on income they have not earned.

 

[fortyplus]

Introduced by Labour in 69 and abolished in 88 by Nigel Lawson.

? surely retained by Maudling when he abolished Schedule A tax on imputed rental income for owner-occupiers?

 

[Dexter Deadwood]

How so? What you are suggesting is making people pay tax on income they have not earned.

I'm not suggesting that at all.

 

[Manter]

Why should the taxpayer pay for business costs?

Because small businesses are critical to the economy* and the aim is to encourage growth, to increase the tax base longer term. If I expand my business (er, my imaginary business) and hire two more employees, that's two more sets of tax, they buy stuff etc etc.

I really don't think it's am issue tbh and I'd be v cautious about doing something that hammered small businesses- the tax issues around big businesses are much more critical


*This says 95% of uk employees are in small or medium sized enterprises https://www.kent.ac.uk/careers/sme.htm ....

 

[Rushy]

I'm not suggesting that at all.

Sorry fella but that is exactly what you are proposing.
If tax relief was available on loan capital repayments as well as on the interest then yes, the tax payer would be forking out. But it's not.

 

[Dexter Deadwood]

Because small businesses are critical to the economy* and the aim is to encourage growth, to increase the tax base longer term. If I expand my business (er, my imaginary business) and hire two more employees, that's two more sets of tax, they buy stuff etc etc.

I really don't think it's am issue tbh and I'd be v cautious about doing something that hammered small businesses- the tax issues around big businesses are much more critical


*This says 95% of uk employees are in small or medium sized enterprises https://www.kent.ac.uk/careers/sme.htm ....

This is one of the problems of having this kind of discussion.
It's always about growth, GDP, GNP, rates of return, investment opportunities, risk and reward, creating a suitable business environment.
It's impossible to have a rational discussion about this because the arguments are imprisoned in a neoliberal mindset That's what thirty years of Thatcherism has achieved. Free market proponents contradict themselves just as neoliberalism contradicts itself.

I'm arguing for another way of living that isn't centred around the profit motive where the production, allocation and management of resources like housing are not left to the free market.

 

[Rushy]

This is one of the problems of having this kind of discussion.
It's always about growth, GDP, GNP, rates of return, investment opportunities, risk and reward, creating a suitable business environment.
It's impossible to have a rational discussion about this because the arguments are imprisoned in a neoliberal mindset That's what thirty years of Thatcherism has achieved. Free market proponents contradict themselves just as neoliberalism contradicts itself.

I'm arguing for another way of living that isn't centred around the profit motive where the production, allocation and management of resources like housing are not left to the free market.

Well proposing a tax tweak the main effect of which would be to stop small businesses from offsetting all their genuine costs against their income is probably not the most obvious place to start.

 

[Dexter Deadwood]

Sorry fella but that is exactly what you are proposing.
If tax relief was available on loan capital repayments as well as on the interest then yes, the tax payer would be forking out. But it's not.

If a mortgage payer can get tax relief on the interest that mortgage attracts then surely that is a taxpayers subsidy?

 

[Dexter Deadwood]

Well proposing a tax tweak the main effect of which would be to stop small businesses from offsetting all their genuine costs against their income is probably not the most obvious place to start.

Well i've made lots of other proposals as well but they have been ignored.

 

[Rushy]

If a mortgage payer can get tax relief on the interest that mortgage attracts then surely that is a taxpayers subsidy?

I'm listening. Why is being allowed to offset the cost of a business loan against your businesses income a subsidy?

 

[Rushy]

? surely retained by Maudling when he abolished Schedule A tax on imputed rental income for owner-occupiers?

Fuck - I don't know. All I know is that I didn't qualify for MIRAS when I got my first mortgage in 96.

 

[Dexter Deadwood]

I'm listening. Why is being allowed to offset the cost of a business loan against your businesses income a subsidy?

You are conflating two issues into one argument and i've answered.

 

[Dexter Deadwood]

There is an interesting article just published here;
Overseas property buyers are not the problem: landlord subsidies are
To stop the market overheating, we must end tax incentives for buyers, improve tenants' rights and make better use of our stock
http://www.theguardian.com/commenti...property-london-landlord-subsidies?CMP=twt_gu

 

[leanderman]

There is an interesting article just published here;
Overseas property buyers are not the problem: landlord subsidies are
To stop the market overheating, we must end tax incentives for buyers, improve tenants' rights and make better use of our stock
http://www.theguardian.com/commenti...property-london-landlord-subsidies?CMP=twt_gu

Absolutely.

But not going to happen - MPs own multiple homes and the economy is addicted to housing