Monthly Archives: October 2014

Government recruits landlords as unpaid immigration officers

There is much discussion about the problems of immigration into the UK, legal and otherwise.  I believe that responsibility for immigration control has recently passed to the Home Office – but this is Wednesday, so who knows?  As we know, while Britain remains part of the EU there is next to nothing that can be done to tackle the huge numbers of legal immigrants from the EU.  However, despite appearances, Britain does have the right to exclude illegal immigrants.  The question is HOW?

Illegal Immigrants and private rented accommodation

Generally speaking, most illegal immigrants end up in private rented accommodation, and will often go to landlords who are renting directly rather than via an agent.  This of course is no reason to run to an agent as they can easily cost a landlord around £1000 a year just for a let only service.

This new scheme is being rolled out gradually across the country, starting already (October 2014) in the Birmingham area – eventually, the whole of the country will be covered probably by the end of 2015.

Landlords – The New Unpaid Immigration Officers

All residential landlords will become legally responsible for checking that prospective tenants have the right to rent in the UK.  Fines of up to £3000.00 will be available to the courts for transgressors.  The right to rent extends automatically to all residents of the UK, Switzerland and the EU.  Landlords will have to typically examine prospective tenants’ passports to confirm that the tenants do indeed originate from where they say they originate.  Unbelievably they will be required to ‘check in the presence of the holder (in person or via live video link) that documents appear genuine, that the person presenting them is the prospective occupier, the rightful holder and allowed to occupy the property.’ ‘Via a live video link’! – you couldn’t make it up.  Landlords will have to verify that relevant expiry dates have not passed etc etc…

Generally, passports are the documents of most importance but other documents can be acceptable.  Other documents such as birth certificates, adoption certificates, current Home Office immigration certificates – the list goes on and I have provided a link to the definitive government document as a pdf download here.

Landlords will have to keep safely copies of all relevant identity checking documents.  As yet the government haven’t stated whether or not landlords will be issued with appropriate border guard uniforms.

Landlord Rent Guarantee Insurance and Tenant Referencing

In fact, wherever your tenant originates, it’s a great idea to take out Landlord Rent Guarantee Insurance, which pays out in the event that your tenant doesn’t and helps you evict them into the bargain.  The thing is that this insurance almost always requires strict tenant referencing as a mandatory requirement, and this includes careful passport and identity checking.  So, you can do the UK Border Agency’s work for it while helping to safeguard your rent!  Landlords and Letting offers this insurance, from only £53.00 for 6 months cover – check it out here.

Summary

So there we have it – yet another pile of red tape for landlords to deal with.  Admittedly, there are rogue landlords out there who rent sheds in their squalid back gardens etc but the majority of residential landlords are law abiding and just want to provide a good service for a decent rental return.  However, because the government and its useless Border Agency with its even more useless computer systems are so inept they are having to pass on some of the responsibility for policing Britain’s borders to ordinary landlords.  Good luck!

Go to Download Government Landlords’ Guide to Immigration Checking

 

Landlords and Letting

 

 

 

 

Time to reform Stamp Duty Land Tax?

Stamp Duty Land Tax, more commonly referred to as Stamp Duty is not only yet another iniquitous government tax on property, it is a tax designed by idiots – but no surprise there!  See our Poll below…

Stamp Duty Thresholds on Residential Properties (October 2014)

  • £0 to £125,000 – No Tax
  • £125,001 to £250,000 – 1%
  • £250,001 to £500,000 – 3%
  • £500,001 to £1 million – 4%
  • Over £1 million to £2 million – 5%
  • Over £2 million – 7%

Look at the Stamp Duty thresholds above.  This shows the real idiocy of Stamp Duty.  As soon as a property transaction exceeds a specific amount – even by a £1.00, the WHOLE of the transaction is subject to the next level of tax!  Thus if you buy a property for £250,000 you will pay £2500.00 in Stamp Duty, whereas if you paid £250,001 you would pay £7500.03 in Stamp Duty!

As far as really expensive property is concerned, it’s even more ridiculous. Take an example of a property selling for £2 million the Stamp Duty would be an incredible £100,000.  But – if that same property sold for £2,000,001 the Stamp Duty would be…£140,000.07!  In other words about £40,000 more.

Distorting the market

Apart from being an outrageous amount of money, this of course badly distorts the property market, with sales just above one of the thresholds being incredibly hard to achieve.  So, a property valued at £250,000 really achieve £300,000 before you can get the real value when you sell, because buyers will be put off houses that are advertised for say £265000 and will try everything to push them below the threshold.

Dodgy Dealing

Of course, because this tax, via fiscal drag, now accounts for such a huge amount of money, people try to avoid it.  There are various schemes dreamed up by clever property lawyers that involve arcane and complex procedures to avoid SDLT but they are of course risky.  Also, some people claim that part of the price includes fixtures and fittings such as kitchens – but really there is no way to safely avoid this scurrilous tax.

What we need is for politicians to wake up to the stupidity of this tax and if it really has to be at these levels then it should work in the same way as income tax and tax the marginal amount by which a sale price crosses a threshold.  An example would be say a property selling for £260,000 would bear 1% on the first £250,000 and 3% on the final £10,000.  Also, why on earth does it jump from 1% to 3%!

In conclusion, the reason this tax exists in its present form is because it does.  Civil servants and politicians often are incapable of original thought and just go on doing something in the way it’s always been done – just because that’s the way it’s always been done.

Tell us what YOU think

See our Stamp Duty Poll below…

Does the current UK Stamp Duty system need reform?
YES
NO

Poll Maker

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