• Visitors can check out the Forum FAQ by clicking this link. You have to register before you can post: click the REGISTER link above to proceed. To start viewing messages, select the forum that you want to visit from the selection below. View our Forum Privacy Policy.
  • Want to receive the latest contracting news and advice straight to your inbox? Sign up to the ContractorUK newsletter here. Every sign up will also be entered into a draw to WIN £100 Amazon vouchers!

Homeowners must be taxed on equity in homes to address crisis, MPs told

Collapse
X
  •  
  • Filter
  • Time
  • Show
Clear All
new posts

    #61
    Originally posted by jamesbrown View Post
    Hey, it was the posh end, near Sutton Coldfield, and the 200k in Bitcoins was extra, for the Squirrel tree house.
    You sound like an undercover agent JB.

    Therefore I have gone directly to the vendor.

    The Chunt of Chunts.

    Comment


      #62
      Originally posted by MrMarkyMark View Post
      You sound like an undercover agent JB.
      You ain't seen me.

      Roight?

      Comment


        #63
        Originally posted by Whorty View Post
        You are joking aren't you?

        So, property worth 200k. Mortgage of £100k so equity of £100k

        During year pay off £10k. New equity is £110k so get taxed on the increase in equity of £10k

        This means the house owner has reduced their mortgage from income already taxed, then they are further taxed on that same £10k. Doesn't make any sense at all.
        Tax is supposed to make sense? You'll be telling me next it's all about paying the fair amount!

        But it works pretty much as you describe in countries that have wealth tax. Take Switzerland for example:

        You pay tax on the purchase price, less the outstanding mortgage, every year.
        A notional amount of rent, based on the purchase price, is added to your income. The reasoning being that you benefit from not paying rent.
        When you sell the house, you pay tax on the profit of the sale.
        When you buy a house, stamp duty is due - whether the buyer or seller pays it is negotiable, but both are liable.

        But this is mitigated by:
        Tax deductable interest payments on mortgage.
        No stamp duty to pay if you don't sell within 5 years.
        Tapering profit tax to a minimum after 20 years.
        Home improvements are deductable from the final sale price.
        Home renovations are tax deductable.

        On the other hand, there's only 45% home ownership and nothing like the housing market in the UK. And people often don't pay off their mortgages once they're down to about 50%.

        However, I fully expect if the UK government goes ahead with equity and asset taxing, you'll get the worse of all possible worlds. I.e. all the pain, without the gain. Except abolition of stamp duty on house sales.
        Down with racism. Long live miscegenation!

        Comment


          #64
          A notional amount of rent, based on the purchase price, is added to your income. The reasoning being that you benefit from not paying rent.
          By that logic someone who cycles to work should be paying for notional petrol and notional road tax for the benefit of not paying for a car...

          Comment


            #65
            Originally posted by ChimpMaster View Post
            It's all very simple unworkable. Tax the billionaires and the huge corporations that don't pay their "fair share".

            Globally, the 1% that own 50% of the world's wealth - tax them so that they don't own more than, say, 5% of the world's wealth, which is still a ridiculously huge amount. ...
            FTFY

            (Hint: The UK doesn't decide tax policy for the whole world.)
            Work in the public sector? Read the IR35 FAQ here

            Comment


              #66
              Originally posted by DimPrawn View Post
              By that logic someone who cycles to work should be paying for notional petrol and notional road tax for the benefit of not paying for a car...
              Shhh! They might hear you!
              Down with racism. Long live miscegenation!

              Comment


                #67
                Lots of variants of this. The purist form is probably the land value tax on the value of unimproved land (so discounting the buildings).

                https://en.wikipedia.org/wiki/Land_value_tax

                Comment


                  #68
                  Originally posted by NotAllThere View Post
                  OK, so your reasoning is that:

                  1. In order to affect the housing market, an equity tax of around 50% would be required.
                  2. At that level, no-one will ever move house, as it will be too expensive.

                  But why would it be set at 50%?

                  What would be the result if it was set at 7.5% (for example)?
                  If it were set at 7.5%, anyone planning to sell who was in a position to make a profit would find a lender (and there would be many) willing to offer a short-term mortgage sufficient to exonerate them from any tax. If nobody is paying any tax, the tax rate will have to go up, so that the poor feckers who for whatever reason can't remortgage make up the shortfall. The very thought of a high equity tax would be a very large kick in the gonads for the property market. All the foreign speculators would disappear, for a start, and that's probably a good thing, but it wouldn't necessarily be such a good thing if they all did so at once.
                  His heart is in the right place - shame we can't say the same about his brain...

                  Comment


                    #69
                    To be logically consistent with current UK taxes, CGT on sales would make sense. However I read recently how Belgian wealth tax works, and we could change to taxing all assets that way. So no more income tax on dividends and interest, or CGT on share gains, but add up the value of everything you own, including equity in your house, and your taxable income is 4% of that. If your marginal rate of tax is 20%, you pay 0.8% tax each year on the total value of your assets.

                    Comment


                      #70
                      Originally posted by IR35 Avoider View Post
                      To be logically consistent with current UK taxes, CGT on sales would make sense. However I read recently how Belgian wealth tax works, and we could change to taxing all assets that way. So no more income tax on dividends and interest, or CGT on share gains, but add up the value of everything you own, including equity in your house, and your taxable income is 4% of that. If your marginal rate of tax is 20%, you pay 0.8% tax each year on the total value of your assets.
                      Does that mean there is no point in paying your mortgage off?
                      "You’re just a bad memory who doesn’t know when to go away" JR

                      Comment

                      Working...
                      X