Mortgage intermediaries should be wary of buy-to-let tax advice in order to avoid any involvement in the next potential mis-selling scandal, speakers at the Financial Services Expo in London said yesterday.
Talking at a specialist lending panel, Vida Homeloans director of sales Louisa Sedgwick detailed the importance of brokers having documentation that states they offered no tax advice as a way of protecting themselves.
Brightstar Financial chief executive Rob Jupp agreed, adding that, “the important thing is that brokers spend the appropriate time making sure that they never cut corners on BTL transactions. And that appropriate documentation is in place from specialist tax advisers to accept responsibility for the advice they give.”
OneSavings Bank sales director Adrian Maloney pitched in too: “Make sure that your clients are getting the right tax advice and that you, as an adviser, are almost isolating yourself to the mortgage advice. Tax advice should only be done by someone who knows the process inside and out.”
The panel also touched on how tax changes will affect landlords more broadly. Precise Mortgages managing director Alan Cleary spoke about how there is a split in understanding between professional landlords and those with a smaller number of properties: “We have stats which suggest that around half of amateur landlords don’t know exactly what is going to happen to their profitability as a result of the tax changes,” he said.
Keystone Property Finance chief executive David Whittaker, meanwhile, commented: “Lots of landlords remain blind to exactly what is going on, they are aware there is a problem but don’t know how to quantify it yet. And when most of them do their tax returns most of them are going to get a wake-up call.”