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Effluent Man
3rd Dec 2014, 18:30
Yet another give away for the wealthier members of society.I noted the BBC stated that the saving on a 510,000 hoiuse will be 4,900.It won't be,it is in fact 10,000. If you are buying a house for 250,000,a far more common figure,the saving will be...zero.

Smoke and mirrors once again because it's true 98% do save.Pay 249,950 and you save 50p.


Actually that's wrong..it's a quid.

Loki
3rd Dec 2014, 18:46
On the other hand, buying a house at 500k or so, anywhere near here won't get you much.

sitigeltfel
3rd Dec 2014, 19:12
Bit of a bugger for those whose transactions were completed today :*

beaufort1
3rd Dec 2014, 19:28
What's stamp duty? :}

Shaggy Sheep Driver
3rd Dec 2014, 19:30
Makes more sense than Labour's :yuk: proposed Mansion Tax; an annual tax on the notional value of a house whose value you can't realise and therefore will not finance the paying of the tax!

goofer3
3rd Dec 2014, 20:06
Well it's a good day for me because if all goes well I should save about 4,500 :ok: But moving house is still an expensive business............

Economics101
3rd Dec 2014, 21:24
We generally teach our students that the incidence of a tax (i.e. who really pays as opposed to who legally is liable to pay) is on the inelastic side of the market. For housing, the supply (stock of houses) is pretty inelastic, i.e. fixed in the short run so the incidence should be mostly on the supply side.

Thus if stamp duty is decreased, buyers who have a reduced amount of the tax to pay will tend to bid a higher (net of tax) price, and thus the seller gains. Competition between buyers for a relatively fixed supply of houses is what drives this.

You can think of stamp duty as a wedge between the price the seller gets and the price the buyer pays. It's by no means the case that a reduction in this wedge is entirely reflected a reduction in the total price incl tax that the buyer pays.

However in the long run... but then we are all dead as Lord Keynes said.

BenThere
3rd Dec 2014, 21:35
If you live somewhere that 500k UK pounds won't buy you much, and you have an equity at that level, I'd suggest you move somewhere that such a sum would not only purchase a fine residence, but leave enough left over to live a comfortable lifestyle.

Currently popular in the Western Hemisphere are Ecuador, Panama, Nicaragua and Belize. If you have a million UK pounds in the bank, you could easily make the move, live in princely style, and never experience winter again.

Shaggy Sheep Driver
3rd Dec 2014, 21:39
Yeah Ben, but the beer's rubbish!

M.Mouse
3rd Dec 2014, 21:40
Effluent Man

The BBC is correct.

Old rates for a property over 500,000 was 4% on the whole amount which would be a duty payable of 20,400.

The new rate is 0% to 125,000, 2% 125,001 to 250,000 and 5% 250,000 to 975,000 which would attract a duty liability of 2,500 + 13,000 = 15,500. so the saving is.....eeeerrrrrr.....4,900.

But hey, let's not let facts get in the way of myopic socialist envy.

I will benefit if I move and as a higher rate taxpayer who has been prudent and saved all my life I am sick to death of the amount of tax I pay on EVERYTHING - income, savings interest, investments, VAT, etc., etc.

Effluent Man
3rd Dec 2014, 22:18
Yes that is right ,I had thought it was 5% over 500k.Still on the plus side when I put mine on the market in the New Year I will at least be a few grand to the good.

Seldomfitforpurpose
3rd Dec 2014, 22:59
Yes that is right ,I had thought it was 5% over 500k.Still on the plus side when I put mine on the market in the New Year I will at least be a few grand to the good.


So it's a good thing then.......

charliegolf
3rd Dec 2014, 23:07
Thank goodness the move is going to balance the books through the mahoosive stimulus it will provide. Oh, ...

CG

Capot
3rd Dec 2014, 23:35
So it's a good thing then....Sure is; we complete in 10 days time, saving 4,550 of a value of 545K.

That's the office conversion taken care of, with a bit left over for the new mainsail.

Hurray.

Effluent Man
3rd Dec 2014, 23:45
Seldom, It is for me.

Ben There,My thoughts exactly.Normandy looks appealing and I can get a similar house to mine for 50%.That combined with Mrs EM reaching her teaching pension in July makes it an attractive proposition.

Capetonian
4th Dec 2014, 04:58
When I glanced at the title of this thread I thought it was a new and uncomplimentary nickname for the Chancellor.

Krystal n chips
4th Dec 2014, 05:28
" Currently popular in the Western Hemisphere are Ecuador, Panama, Nicaragua and Belize. If you have a million UK pounds in the bank, you could easily make the move, live in princely style, and never experience winter again

Yes indeed... but, strange though it may seem to you, the UK is actually located on the Western Hemisphere and, oddly enough, we are not being bombarded with adverts to relocate to the exotic climes you suggest.

If you have 1m in the bank, and to avoid winter....you simply live in the UK during the Summer and leg it to somewhere warm and civilised....Oz / NZ for example, in the winter.

Plus, if you do have 1m in the bank, you can massage your ego and flaunt your vanity with your own little fiefdom quite easily in the UK anyway....

Wingswinger
4th Dec 2014, 07:15
I've got news for you, Krystal. One mill doesn't go far these days. I'd say you need 5m at least to live comfortably in the UK with wintering abroad. Without trading your labour, that is.

Kelly Hopper
4th Dec 2014, 07:19
Particularly in OZ.

Wingswinger
4th Dec 2014, 07:41
Back to stamp duty. By my calcs:

At 500k it's a 5K reduction
At 600K it's a 4k reduction
At 700k it's a 3k reduction
At 800k it's a 2k reduction

But at 1.5m it's a 33.75k increase.

Since you don't have to try hard to find nice houses at 1.5m in SE England it's whopping tax increase on the hard-working, entrepreneurial and aspirational.

Capetonian
4th Dec 2014, 08:34
Ed Balls talking ....... well ...... balls :

"We will do it fairer ......... we will raise the top rate of income tax ......."

That's fairer?

Seldomfitforpurpose
4th Dec 2014, 09:16
Ed Balls talking ....... well ...... balls :

"We will do it fairer ......... we will raise the top rate of income tax ......."

That's fairer?

Of course it's not but it's designed to appeal the Great Downtrodden.

Bit like this thread an initial outburst about blah blah blah then the realisation that actually it's a tax cut that the masses get to benifit from and that its only once you get above roughly 930k you start taking hits.

Tax cut for the ordinary guy and tax hit for the rich, not something you expect from the Tories and it has pulled the rug from underneath Milliband and Balls with their ill thought out Mansion Tax :p:p:p

VP959
4th Dec 2014, 09:26
The main difference for the majority of people is that it will get rid of all the "dead zones" that the old system created, as the new system is more graduated, rather than sharply stepped.

For example, no one would buy a house for 255K under the old system, because they'd have to pay an extra 5.15K in Stamp Duty because of the step change from 1% to 3% that applied for houses over 250K. This made a 255K house far more expensive to buy than a 250K house (250K house: Stamp Duty = 2.5K, 255K house: Stamp Duty = 7.65K).

The result was that there were artificially created bands just above 250K and 500K where no houses ever sold, The prices were either inflated to be above the "dead zone" or more probably deflated to be just below it.

Seldomfitforpurpose
4th Dec 2014, 09:45
VP,

That was one of the main points being made on 5live yesterday, houses around the 250k mark were simply not selling so this move should see those houses now coming onto the market and selling much much more quickly.

Gertrude the Wombat
4th Dec 2014, 10:07
Tax cut for the ordinary guy and tax hit for the rich, not something you expect from the Tories
We've seen all sorts of things you wouldn't expect from the Tories - that's what coalition government does for you, like it or not (which is your choice of course).

Nick Riviera
4th Dec 2014, 10:20
Yet another give away for the wealthier members of society

Absolute garbage. But then, as your lack of understanding of the figures has shown, you don't have a clue what you are talking about.

Seldomfitforpurpose
4th Dec 2014, 11:07
I can't help feeling that the Conservative Party is trying to out-socialist the socialists.



One of the Radio 5L reporters yesterday suggested this blows the Mansion Tax clean out of the water :ok:

Wingswinger
5th Dec 2014, 07:38
I find it absolutely monstrous that stamp duty exists at all, let alone at a rate of 12%.

I agree. A house at 1.5m will attract 93.75k stamp duty. That's a serious amount of wonga even among those who can contemplate buying a house at 1.5m and it's nothing short of state theft. It's the price of really smart motor car. Or an aeroplane. Or a yacht. I reckon that house prices in the 1m - 2m range are going to be dampened. Nevertheless, the reform is a good move since it removes ridiculous and unjust anomalies which had existed ever since The Great Broon introduced tiered stamp duty. It is to be hoped that it is a pre-cursor to further cuts in this grand larceny. Stamp Duty Land Tax won't be abolished; it's too lucrative for the Treasury.

Effluent Man
5th Dec 2014, 08:05
Reading some of the responses there is something odd going on here. I have just read that having a million pounds doesn't enable you to adopt a good lifestyle. Now there must be some extremely wealthy people contributing to this thread.

If I sell everything I own I am still short of a million. My life lacks nothing that I desire. I don't do much work these days,I generally swan around and chat to people who do work. My wealth has still increased by fifty grand a year since 2011 simply because of the house I live in.

I realise that I am probably odd in not wanting all the shite that comprises the detritus of twenty first century life but that is just me. Judging from the long stream of harassed looking down at heel minimum wage guys who trek up the drive with parcels in their hands MrsEM doesn't share my disdain.I bet they would swap lives with me.

VP959
5th Dec 2014, 08:15
Worth remembering that only a minute number of people will be hit by the higher rate of Stamp Duty, whereas the vast majority of people will have a fairer system with no big jumps of tax around the average house price.

It's worth noting that, despite all the hype, the average house price in England and Wales (across all house and apartment types) is 177K, so below even the old 3% threshold by a significant margin. (source - The Land Registry October 2014 House Price Index, which uses the actual sale price of houses as the data source https://www.gov.uk/government/statistical-data-sets/house-price-index-statistical-report ).

Someone buying a house now for 177K will pay 1,024 in Stamp Duty. Under the system that applied before this change they would have paid 1,770, 42% more in tax.

It is a more socialist reform than I would have expected from this government, but I don't think it was driven by any form of socialist desire. I suspect one motive was to address a peculiar London problem, where even the well-heeled amongst the Tories are finding that house prices in parts of London are being driven up beyond their reach by cash buyers from Russia, the Middle East and even China.

Effluent Man
5th Dec 2014, 09:45
It's high time this issue is addressed too. Allowing all and sundry to pile into the market isn't going to help anyone long term. None EU purchasers looking for a safe haven for their cash as well as a quick profit should at the very least attract 100% enhanced duty.

It is distorting both the sale and rental markets by stacking up tens of thousands of empty properties. And it is not as if we've not been here before, it is entirely predictable: Staggering inflation of prices exacerbated by short supply compared to demand. The market tops out and profit taking commences followed by the minimisation of losses by those johnny come latelys hitting the silk and the whole caboodle goes into freefall. It is a classic bubble and not a case of if,but when.

Wingswinger
6th Dec 2014, 00:14
I have just read that having a million pounds doesn't enable you to adopt a good lifestyle.

Invest a million. Take as much income from it as you can but make sure that also preserve the capital value of your investment taking inflation into account. Pay income tax on your investment income. You'll be lucky to have 2k per month to meet all your living expenses. You're not going to enjoy the life of a prince on that.

Krystal n chips
6th Dec 2014, 08:09
" You'll be lucky to have 2k per month to meet all your living expenses. You're not going to enjoy the life of a prince on that.

Really ?.....you seem to have a rather myopic view of economic reality at the best of times.....and the fact many live on considerably less than 2k pm.

And. if you do have 2k pm available, you can live very comfortably on that amount.....all it takes is some simple and basic financial planning.....along with not being gullible by purchasing the "ultimate best next thing.....ever ! " to impress the neighbours / friends..... along with anybody else who happens to enter your life....and your ego.

Wingswinger
6th Dec 2014, 08:39
I didn't say you couldn't live on it. You could, especially if you set up home in the Welsh valleys, Tees-side or the Outer Hebrides. It just wouldn't be a life of luxury and it would be a stretch to support a family.

Effluent Man
6th Dec 2014, 12:38
OK How about this. Spend 500k on a house for yourself,no mortgage. Invest 500k in buy to lets, say 4 x 125,000. Where I live that will bring you 30k p.a. If that doesn't keep pace with your lifestyle then dispose of one of the properties each decade for capital. I don't necessarily approve but that is what a lot are doing. How rich are you?

Seldomfitforpurpose
6th Dec 2014, 13:31
" You'll be lucky to have 2k per month to meet all your living expenses. You're not going to enjoy the life of a prince on that.

Really ?.....you seem to have a rather myopic view of economic reality at the best of times.....and the fact many live on considerably less than 2k pm.

And. if you do have 2k pm available, you can live very comfortably on that amount.....all it takes is some simple and basic financial planning.....along with not being gullible by purchasing the "ultimate best next thing.....ever ! " to impress the neighbours / friends..... along with anybody else who happens to enter your life....and your ego.

So you can't enjoy the life of a Prince.........which is wot e said innit :p

Shaggy Sheep Driver
6th Dec 2014, 14:00
I see from the quoted post above that K&C is up to is usual tricks. Wingswinger said "you're not going to live like a prince on that" (2k / month).

K&C then castigates WS, saying "many live on less than 2k / month"!

K&C, WS said "live like a prince", not merely "live". Do you really think such mis-representation of what others have obviously posted goes un-noticed? Why do you do it? It just re-confirms one reason why you comprise my ignore list.

Effluent Man
6th Dec 2014, 15:02
Why would you want to live like a prince?

419
6th Dec 2014, 16:35
Why would you want to live like a prince?

He is a bit weird at times but he doesn't seem to have had a bad life.

http://cinetropolis.net/wp-content/uploads/2013/03/purple-rain-bike.png

Krystal n chips
6th Dec 2014, 18:44
K&C then castigates WS, saying "many live on less than 2k / month"!

Alas, you seem somewhat histrionic here....although this is usually the case with pensions and / or Labour so it's not exactly a revelation. The word castigate is terribly emotive, thus, in suitably muted and reverential tones, may I advise you, and others ( you get a mention SFFP ) that, I did not castigate, but did offer a "in comparison to which" perspective.


K&C, WS said "live like a prince", not merely "live". Do you really think such mis-representation of what others have obviously posted goes un-noticed? Why do you do it? It just re-confirms one reason why you comprise my ignore list


I am always grateful when one of my betters offers me advice based on those sound Victorian principles of priggish sanctimony . Indeed, keeping up appearances on an internet forum is terribly important !....after declaring a "PAN" for a stuck kitchen draw, will you be declaring a "Mayday" when a shoelace snaps ?

Basil......some dashed good news old chap ! .....both the Danegeld and Carucage have been abolished !...;)

Finally, Wingswinger.....if you can afford to part with some of your millions, take a trip around the UK...take your time and let us know your perceptions of life outside the S.East.....it does exist.

Shaggy Sheep Driver
6th Dec 2014, 19:43
I've no idea what he / she posted but I'd wager it's the usual patronising piffle.

Wingswinger
6th Dec 2014, 23:04
Finally, Wingswinger.....if you can afford to part with some of your millions, take a trip around the UK...take your time and let us know your perceptions of life outside the S.East.....it does exist.

You picked the wrong person to adopt that tone with, fella. You know nothing of me nor will you. But, the one thing I will let you in on is that I hail originally from one of the roughest, deprived parts of Glasgow. I know what I speak of. And I know how people can raise themselves. It starts with ignoring left-wing politicians.

Effluent Man
6th Dec 2014, 23:20
It's this "Self made man" thing I understand least. When I ran a business I paid my employees the top wages I could afford. I think I paid about 30% above the going rate. I regarded my employees and their families as friends and I still maintain contact.

I find it quite satisfying when third parties tell me that my ex employees regarded me as a good boss. I possibly could have made more by exploiting them but what for? I have enough. It seems to be this that the typical Tory business type doesn't understand but there is a great deal of satisfaction to be had from living your life in this way.

Gertrude the Wombat
6th Dec 2014, 23:30
I possibly could have made more by exploiting them but what for?
I had a boss once who didn't believe in making a profit - if he did that he'd only have to pay out some of it in tax.

He much preferred the money to go on things like food and drink for his staff before the tax man got a look in.

So if there was a danger of the company making a profit he might remind us that the company had an account at the local pub for staff to charge their dinner to when they were "working late", as well as putting on really rather good Christmas parties (the company hired a hotel for the weekend).

There were from time to time various things his staff would grumble about, but the boss taking home all the money was most certainly not one of them.

Wingswinger
7th Dec 2014, 07:43
That's all very well. Truly admirable and enlightened. That sort of thing can only be done by business owners who don't have share-holders to satisfy - just themselves. What would happen though, in the event of choppy waters and a resulting need to make staff benefit cuts and/or cut wages and jobs in order to ensure the business survived? How would such business-owners grow sufficient capital to cushion their enterprise against adverse circumstances. How about diversification which is probably the best course of action to take to ensure business survival?

Effluent Man
7th Dec 2014, 08:47
I felt that I gained benefits in terms of loyalty and co=operation. As an example I employed a car valeter. It's a rotten job but my chap was good. I lived eight miles from the business whilst he lived round the corner. If someone wanted to pick a car up after hours he would offer to nip back.

In return I paid him a skilled man's rate and he could afford things like holidays that were beyond the means of valeters who worked for other people. OK it's a dirty word,but it was a form of Socialism and it worked for me and for him.

Wingswinger
7th Dec 2014, 09:16
EF, I don't see it as socialism at all. No-one forced you to adopt such practises, you did it willingly yourself and for good reasons. As you alluded to, there is always a payback for such altruism. Some, however, would call it paternalism and say that self-interest lies at the root of such virtue. There are always carpers.

Shaggy Sheep Driver
7th Dec 2014, 10:18
I once worked for a company where it was great fun, Friday afternoons in the pub with the boss paying, and I loved it. We made no money and got taken over!

We were obviously living in an unsustainable style. I think you can only get away with that if you operate in some sort of protected environment, like a monopoly or the public sector. :E

Effluent Man
7th Dec 2014, 10:21
I was a second hand car dealer and repair garage. You don't get much more red in tooth and claw than that.

Shaggy Sheep Driver
7th Dec 2014, 10:40
I agree, EM, but in a cut-throat industry like that the rules are a bit different and perhaps my post above didn't take that into account.

If your competitors really screw their staff into the ground and in contrast you make life a bit better for yours, the extra cost in so doing may be money wisely spent.

While your competitors find staff just don't turn up because they have found a better job, or do shoddy work because they are pissed off, this can lead to lost business and extra cost of doing business which you avoided. But I'd think it's a fine line...

I used to take my motor bikes to guy up the road for their MOT because he was a bit cheaper. Problem was, half the time his motorbike man had walked out for a better offer elsewhere. I now take my bikes elsewhere.

Effluent Man
7th Dec 2014, 14:01
My only competitor in a fairly large village was a guy who had moved up from Basildon and had served for Her Majesty after a heist went wrong. He adopted the opposite business model, largely staffed by dole wallahs and doing quite a bit of the old dickery-docking.

He is still there,tells old fellas they need a new gearbox when it needs a 50p clip replacing. He actually did that on an Astra Auto and ended up getting punched by the guy's son. His garage was next to the church,so I dubbed him The Clocking Cleric. It would make a comedy show.

Seldomfitforpurpose
7th Dec 2014, 16:07
I've no idea what he / she posted but I'd wager it's the usual patronising piffle.

It certainly is :ok:

Senior Paper Monitor
7th Dec 2014, 16:38
Mind boggling level of thread drift !

Shaggy Sheep Driver
7th Dec 2014, 16:51
Mind boggling level of thread drift !

But of course! Jet Blast innit! The forum equivalent of a pub conversation, and they drift all over the place.

Effluent Man
7th Dec 2014, 16:58
That's part of the charm.We are going to a dance,send three and fourpence!