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Found 7 results

  1. Hello all, I'm looking to buy a BTL but unsure on whether I NEED to buy within limited company or not. I'm just below the HRT tax band currently but another property will put me into the HRT tax band, and therefore i have been thinking to buy within a Ltd company. However, I'm aware that making a pension contribution would extend the tax band. Therefore, if my assumption is right, surely this would be a quick and easy way of mitigating the HRT that would otherwise apply? I can't see this being covered anywhere so i would be most grateful if someone here with experience could enlighten us. Many thanks
  2. Hi Has anyone worked out the difference between BTL vs Pension investment for a higher rate taxpayer. I want to run the maths and see which one is actually better. So far I've worked out that the pre-tax income is 72% better with a BTL assuming: 1. Salary sacrifice scheme which puts 100% of the employers NI into the pension fund 2. Property value doubles in 10 years time 3. 3.5% net rental return 4. Mortgage is paid for by the rental profits with no excess 5. 2% return on the shares (which I know is low but this is the "safe withdrawal rate" some people claim) 6. 5% income on shares 7. 5% capital growth on shares Note - I don't want to debate the assumptions or go through the pros and cons (e.g. leverage risk, access to the cash etc.) - just has someone worked it out and want to compare notes! Thanks!
  3. Hi everyone, Can I reduce my CGT by making a pension contribution? In this quarter's magazine it says that making a pension contribution increases the higher rate threshold by the gross value of the contribution, so would reduce CGT from 28% (higher) to 18% (basic) on that value. But my situation is this. Earned+rental income is approximately £20k - so I'm a basic rate taxpayer. This year, I have made a taxable gain (fater relief) of approximately £20k. So I am facing a CGT bill of 18% (basic rate) on £20k = £3,600. I was planning on making a gross pension contribution of £20k, reducing the CGT bill to nil. That was how I understood it, until I read what the magazine said this week. Can anybody help, please? I can and would make the contribution if it helped, but wouldn't if there wasn't this benefit. Many thanks everyone! David
  4. Afternoon everyone, I have a contact who runs a membership group for people exploring their options for their pension/retirement. He is running a panel at one of his events and wants a property investor who is investing for his pension to be part of a panel on what to invest in for your pension. Event will be in September/October, in London or Surrey. If you are interested let me know and I will put you in touch with him. Thanks
  5. Hi, I'm a first-time poster, I searched the forums for a topic like this and I couldn't find anything - but I apologise if it has already been discussed. My questions is: should my wife and I stop contributing to our employer pensions each month and instead put that money towards saving for a deposit on a buy-to-let? We're both 30 years old, work full time and we have an 18 month old daughter. We are keen property enthusiasts, we have been studying property for around 18 months and we're really keen to get started. We're in it for the long term, believing in buy-and-hold, slow and steady. The ultimate goal is to create long term wealth which grows over time, allowing us to retire early (mid-40's). We are saving hard for the first deposit which we think we should be able to achieve within 18-24 months. We have a strategy broken down into weekly goals which keep us on track for this. With regards to the pension contributions; I've crunched the numbers and after tax/deductions, we would have an extra £325 real cash in the bank each month if we stopped contributing to our pensions. However we would end up sacrificing £166 to the tax man each month and we would stop receiving £400 per month in employer's pension contributions. My gut tells me to go "all in" on property because if successful then we won't need a pension pot due to the income provided by our portfolio, however my head tells me that the pension pot is a safety net which should remain in place in case everything turns sour. After all "stop contributing to your pension" isn't advice you hear every day!! £325 per month would make a serious impact on our ability to save for a deposit now, but it would be at the expense of losing £566 per month (£166 + £400) of "free" pension contributions. I understand that ultimately only my wife and I can make this decision but I would be really grateful to hear others' opinions and words of wisdom from their own experiences. Thanks in advance!
  6. I've been reading in the news lately that up to half a million pension pots will be cashed in early to invest in buy-to-let properties. Even Mark Carney (Gov Bank of England) has commented upon it. He doesn't think there's need for the Bank of England to take any action on this although he'll be keeping this under review. I'm just about to take the plunge in property investing and this news is a little worrying. Does anyone have any thoughts on this? Thanks Dean
  7. Hi, Hypothetical situation for you. You are 64 years old and married. You just sold your house for £650k and downsized. You have £250k to generate an income through property for your retirement together. Your BTL portfolio will be your only source of income (apart from state pension which is only about 3k a year and doesn't kick in until you are 65). How would you go about this? Would you look to buy one property with cash and live off the, let's say, £18k net? Where would you buy? Or would you look to get a BTL mortgage on 2 or 3 different properties? Or would you approach the problem completely differently? Would love to hear your thoughts.
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