What financial steps are you taking to hedge the risk of a Burham Budget?

[Toohotforwork]

With all the financial uncertainty at the moment what are you doing to prepare/de risk Burham's actions?

We were in a chain to move house but have pulled since we don't really need to move. If the wealth tax came in the new house would be a silly choice and if stamp duty changes we might be better going somewhere else.

I think CGT will increase so we have trimmed our share portfolio a bit. We crystalized some gains and rebased them to current valuations.

We have taken cash that was sitting in the business out to protect from dividend increases. We'll decide where to invest it once we have a bit more clarity on what is going to happen. If interest rates increase will pay down the debt on our rental for example.

What have you been doing to hedge your finances?

To be honest I haven't, I ought to take advice on pension as I am mid fifties, but not planning to move house and don't have any liquid investments outside pension. However that is a cost I could do without. Overall property value not high so hoping that won't get taxed.

Loathe the idea of a continuing property tax, council tax is bad enough, far rather know I have paid for it via sdlt. Having a stable tax system over the long term is really important, no surprises, it allows people to be sensible. The trouble with taxing those who have saved is it just penalises those who are sensible.

You seriously pulled out of a house sale on the off chance of something happening? Did you really stretch yourselves or something?

I’m just getting on with my life to be honest.

I would be moving my shares into an Investment ISA if I were you, then you don't have to worry about CGT.

i’m not rich so nothing

Nothing

Nothing on the basis of speculation alone.

Nope - we are still moving as need to upsize.
I already got spooked with the interest rates rising before so I lowered our price point to make sure we wouldn’t regret it anyway.

I’ll be really annoyed if they swap stamp duty after I’ve just paid it but we need to move and it should be soon so I’m not pulling out as it might never happen.

Sounds like you are really doing it tough 😂

I don’t worry about the maybes and only focus on reality. Can’t believe you pulled out of a house move and messed that chain around.

Not stretched at all. We have the cash. Just don't want to get locked in to a wealth tax. it would be foolish to move somewhere not knowing what the annual cost would be surely, Once we know what will happen we will reassess.

We have to make decisions based on speculation, once decisions are announced we would be locked in. That's why we're trying to hedge the risk.

Do you have wealth of over £10million? If not you don’t need to worry about a wealth tax, as that’s the minimum level being proposed by anyone. Even then it would only be 2% on wealth over £10million, which if you have that much money you can certainly afford.

That's not what is being talked about. He is talking about 0.5%-1% of property value every year. That would be £15,000 per year to live in a slightly nicer place. Not worth the risk at the moment.

I'm of the view that he'll only be PM for two years, and then we'll be rid of them for a generation, so I'm going to freeze everything until Labour are out of office.

Yeah, I don’t believe you. This is political rage bait. Anyone with a few quid and an ounce of intelligence is not pulling out of house sales purely on some political speculation, nor are they talking about it with poor SPAG at 10am on a Friday on MN.

Why is it rage bait? This is the Money Matters section. Not Politics.

Surely everyone looks at their finances in the light of what is going to change in the future. We are possibility about to have a lot of change.

The housing market has frozen generally as a lot of people are thinking like us.

Because you’re trying to do it by stealth as much of the rage bait is done online these days, you think it’s more convincing. Pretending you’re making drastic financial decisions to make others fear the political situation. I’m not stupid.

The chances of that happening are zero. It would absolutey clobber the South East who are already responsible for having paid 4x as much stamp as the North in the last 5 years alone. Vanishingly few people can find £15k a year, every year, on top of their other outgoings and if they allow for it to a be a charge on the property to accue until such time as it is sold, it would bring the economy to a standstill because not a single person would move.

I heard that they were planning a land tax which would be .48% of a property value, capped at £1200 + existing council tax. That is way more achievable, most people would be winners of that and it ensures a steady stream of income every year rather than just relying on stamp when houses are bought and sold.

Nothing at all.

I will react to whatever happens.

CGT / incomes / dividend tax not much I could
do anyway, and the sums not large enough to do anything dramatic ‘just in case’.

My bigger concern is a mansion tax from £1.5m which will just be the final nail in the coffin of my aspiration to buy a bigger house. Which is disappointing but I just can’t be bothered with it.

Agree

That’s not a wealth tax though is it? It’s a property tax. Maybe get your terms straight before you get indignant. We need something to address the massive inequality in housing and if additional property taxes encourage people at the top to downsize that’ll actually get the market moving and correcting. If you don’t need a bigger house then fab, don’t buy one.

If introduced the land value tax would replace council tax. I’ve worked out that based on the current numbers being put forward the cost for my flat would be exactly the same as I currently pay in council tax for a flat in London with a single person discount

Wish I had finances to hedge ?
live to see wealthy people doing their very best to keep it all for themselves whilst children share mattresses on floors of homes riddled with mold

bad taste

and house prices need to fall significantly- homes should be affordable for people without inheritance from other people’s homes . They should
be affordable for people on normal wages with no family help.

We've recently sold our house and for various reasons decided to rent for a bit rather than buy (would have been looking at £2m+). This isn't because of Andy Burnham but, given what may happen with land value tax, we're pleased with the decision. I'm a big fan of the proposal for lots of reasons and will be much better off if it comes in as suggested- I'd far rather pay £10k pa than £200k stamp duty + £5k pa.

I also like the rumours around CGT. Much rather pay 40% of an indexed gain than 24% unindexed.

Generally, despite being high earners, I don't see any of the rumours as particularly concerning and am not anticipating paying much more tax. What happens to income tax rates makes much more difference to us, but he's said he'll stick to Labour's mad pledge on that.