I'm 54 and my wife and I are VERY worried about our future, gas and food prices rising daily. We have had our savings dwindle with the cost of living into the stratosphere, and we are finding it impossible to replace them. We can get by, but can't seem to get ahead. My condolences to anyone retiring in this crisis, 30 years nonstop just for a crooked system to take all you worked for...
Hi Paul, just did your commercial property webinar yesterday and blew me away the difference between residential and commercial. I own a couple of BTLs but it hit home about making £15k per year and still having to work! I’m seeing lots of commercial property where I live (Dunfermline). With commercial property do the lenders do the same checks like seeing how much debt/outgoings you have just like a residential going through etc? I’m due to leave the service next year with no debt and a pension and the commercial route is where I want to go to give me the freedom to be my own boss. Thanks and I hope Florida is going well! Maybe I could catch you for a munro walk when your in Scotland. All the best.
Delighted you see an opportunity in commercial. The lending is far more about the deal and hardly about the individual especially if through a company... indeed maybe see in Scotland! (Florida was great and just home a few hours ago.)
Description of this video is a bit misleading, the video doesn't actually explain how to buy a property in a ltd company. ie. when creating the company surely some capital has to be put in the company before a mortgage company will lend the money, and mortgages available are different to BTL mortgages when buying a property in your own name.
You would need to sell to our limited company. Legals, stamp duty, capital gains etc. Work out this cost. Now to see what you save how much extra tax are you paying due to S24. Then weigh up the decision. Afterwards you are likely to be able to pay yourself profit more tax efficiently (dividend) but if you convert to serviced accommodation S24 is no longer an issue. these are some of the main elements. hope this helps.
@@nikkion2140 thinking about this the best way is to go to the Touchstone Education Facebook community (it is free) and over 17,000 members operating mostly in the UK, they will have very recent experience of setting up etc. Suggest you join and ask there. Good luck
Very insightful video Paul Thank you! I it possible to buy a main residence house in the name of your LTD company and pay no cap gains on the sale? Is that even worth considering? As you mentioned the cost of stamp duty for buyers is at the higher end.
@ Husheana if you place your residential home into a limited company, you have to pay the stamp duty. Also you may have to incur other costs such as buy to let mortgage with higher interest in the company, also the accountants fees on your yearly account in the company's name. But if you have several properties in your company then it may be your worthwhile.
It does apply but there is no adverse impact financially... might seem a funny answer so let me explain: You can only claim interest rate relief at the basic rate of tax for properties owned in your personal name. So if you are a 20% taxpayer thats fine, you can claim your interest expense to fully offset your mortgage interest. Section 24 also applies if you have no mortgage but is again not an issue as you have no interest payments! The section 24 issue is focussed on 40% 0r 45% taxpayers that can only claim 20% relief... hope that makes sense... I have seen this explained really badly (ie wrongly) on RUclips recently and a basic rate tax payer who has "accidentally" become a landlord (eg inheritance / couple move in together and end up with extra property etc) and they only ever intend to have one property will cost themselves a decent chunk of cash if they then set up and run a ltd co. (probably £1,000 pa plus) and also stamp duty/capital gains for selling it over to ltd co. Hope this helps? Paul
@@PaulSmithTouchstoneEducation Thanks Paul for such a detailed answer. It seems the issue having a property in personal name comes around when the rental amount added to someones salary pushes them into the 40% rate
Thank you. Much appreciated. Liver function is very good I have had it checked a few times in the last few months. Weight loss in progress! I need to get down to around 85kg... Currently in Florida for 4 weeks health improvement. I see what you see! Paul
@@PaulSmithTouchstoneEducation Dont mean to be rude. Just concerned healthwise. Once a day meal is easy way to get rid of excess Wt. Give it a go and good luck.
Similar belly happened to me. Turned out to be diabetes. Now I don’t eat sugar and starch Paul’s had many treatments I guess he’s getting the best advice
I'm 54 and my wife and I are VERY worried about our future, gas and food prices rising daily. We have had our savings dwindle with the cost of living into the stratosphere, and we are finding it impossible to replace them. We can get by, but can't seem to get ahead. My condolences to anyone retiring in this crisis, 30 years nonstop just for a crooked system to take all you worked for...
@Christina-Gisela That's actually quite impressive, I could use some Info on your FA, I am looking to make a change on my finances this year as well
@Christina-Gisela I will give this a look, thanks a bunch for sharing.
Do people actually fall for these fake conversations with bot accounts.
Great vlog - It has given me some "food for thought".
Thanks Paul! Amazing work in crunching numbers! Just brilliant
Thanks Paul
Hi Paul, just did your commercial property webinar yesterday and blew me away the difference between residential and commercial. I own a couple of BTLs but it hit home about making £15k per year and still having to work! I’m seeing lots of commercial property where I live (Dunfermline).
With commercial property do the lenders do the same checks like seeing how much debt/outgoings you have just like a residential going through etc?
I’m due to leave the service next year with no debt and a pension and the commercial route is where I want to go to give me the freedom to be my own boss.
Thanks and I hope Florida is going well! Maybe I could catch you for a munro walk when your in Scotland. All the best.
Delighted you see an opportunity in commercial. The lending is far more about the deal and hardly about the individual especially if through a company... indeed maybe see in Scotland! (Florida was great and just home a few hours ago.)
@@PaulSmithTouchstoneEducation Where can I watch this Commercial Property webinar please?
Description of this video is a bit misleading, the video doesn't actually explain how to buy a property in a ltd company.
ie. when creating the company surely some capital has to be put in the company before a mortgage company will lend the money, and mortgages available are different to BTL mortgages when buying a property in your own name.
When you have a business bank account for a ltd company, does the bank expect rebtal income to flow through that account?
I own two properties totalling £120k, would it be worth having these in a LTD company or still in my own name?
You would need to sell to our limited company. Legals, stamp duty, capital gains etc. Work out this cost. Now to see what you save how much extra tax are you paying due to S24. Then weigh up the decision. Afterwards you are likely to be able to pay yourself profit more tax efficiently (dividend) but if you convert to serviced accommodation S24 is no longer an issue. these are some of the main elements. hope this helps.
Thanks Paul. Appreciated@@PaulSmithTouchstoneEducation
thank you!
Thanks. Can you suggest a firm to help to set up a new Ltd company with correct share structure pls.
There are many.... which part of the UK?
@@PaulSmithTouchstoneEducation SE London/England. With most work being done remote/online it is ok for outside London. Thanks.
@@nikkion2140 thinking about this the best way is to go to the Touchstone Education Facebook community (it is free) and over 17,000 members operating mostly in the UK, they will have very recent experience of setting up etc. Suggest you join and ask there. Good luck
You are great Paul --Love your insights parminder singh
Very insightful video Paul Thank you! I it possible to buy a main residence house in the name of your LTD company and pay no cap gains on the sale? Is that even worth considering? As you mentioned the cost of stamp duty for buyers is at the higher end.
Short answer.. no ... you have to buy your home in your personal name or it is not your home, but rather a company asset.. nice thinking though!
Amazing
Thank you Chris. Good luck!
Hi, if I was to turn my residential home into buy to let and make an onward purchase to then live in, can I & or should I put it in a limited company?
@ Husheana if you place your residential home into a limited company, you have to pay the stamp duty. Also you may have to incur other costs such as buy to let mortgage with higher interest in the company, also the accountants fees on your yearly account in the company's name. But if you have several properties in your company then it may be your worthwhile.
@@gazyasaslam7045 thank you.
Do you know what the big difference between UK and US real estate tax code.
There are many differences Dan.. for example LLC vs Ltd Co. and no tax on investment income in the USA. What big difference are you thinking about?
Lovely, thanks for the insight. See you all tomorrow 0915 😊😊
Perfect
I thought Section 24 applied to basic rate taxpayers as well?
It does apply but there is no adverse impact financially... might seem a funny answer so let me explain: You can only claim interest rate relief at the basic rate of tax for properties owned in your personal name. So if you are a 20% taxpayer thats fine, you can claim your interest expense to fully offset your mortgage interest. Section 24 also applies if you have no mortgage but is again not an issue as you have no interest payments! The section 24 issue is focussed on 40% 0r 45% taxpayers that can only claim 20% relief... hope that makes sense... I have seen this explained really badly (ie wrongly) on RUclips recently and a basic rate tax payer who has "accidentally" become a landlord (eg inheritance / couple move in together and end up with extra property etc) and they only ever intend to have one property will cost themselves a decent chunk of cash if they then set up and run a ltd co. (probably £1,000 pa plus) and also stamp duty/capital gains for selling it over to ltd co. Hope this helps? Paul
@@PaulSmithTouchstoneEducation Thanks Paul for such a detailed answer. It seems the issue having a property in personal name comes around when the rental amount added to someones salary pushes them into the 40% rate
Very helpful. How much does it cost to start or run ltd. Cost by accountant?
O my God! Knowledge is power.
Sorry Paul; I cant help: please can you check your liver function to see if you have NAFLD. Forgive me for saying this.
Thank you. Much appreciated. Liver function is very good I have had it checked a few times in the last few months. Weight loss in progress! I need to get down to around 85kg... Currently in Florida for 4 weeks health improvement. I see what you see! Paul
@@PaulSmithTouchstoneEducation Dont mean to be rude. Just concerned healthwise. Once a day meal is easy way to get rid of excess Wt. Give it a go and good luck.
@@nikkion2140 I only eat once a day and I am still a fat b*****d!
@@nikkion2140 completely understood and thank you for your concern, I am eating twice a day and only in an 8 hour window. Thanks
Similar belly happened to me. Turned out to be diabetes. Now I don’t eat sugar and starch Paul’s had many treatments I guess he’s getting the best advice
give me my £38 back