View more on these topics

Offset taxation rumours denied

The government has scotched speculation that the tax exemption on offset mortgages is to be stopped.

Industry sources claim that lenders including Standard Life Bank have been telling brokers that the Inland Revenue is looking closely at offset accounts to tighten up the current situation whereby offset customers are exempt from tax on the savings part of the product.

The IR has denied that any such changes are in the pipeline, calling the allegations “rumours”.

Patrick O &#39Brien, spokesman at the Inland Revenue, says: “Income Tax is only chargeable if income is actually received.

“With an offset, the customer is obtaining a reduction in a debt, not an income on his savings – even though he might regard these things as having a similar effect in economic terms.”

In a statement from Standard Life Bank, Mortgage Strategy was told: “We do not believe that the tax implications of offset mortgages is an issue.

“We make it clear in our documentation that, as no interest is payable in respect of the amounts held in offset reserves, no income accrues to the borrower and therefore no tax is payable.

“Should the Inland Revenue rules change, our customers in any case have an alternative way of achieving the same overall position by overpaying, secure in the knowledge that they can redraw their overpayments if they need to.

“These are ring-fenced in the customer&#39s pre-payment reserve.”

Recommended

Record numbers expected for first Property Investor Show North

Organisers of The Property Investor Show North, a comprehensive event for landlords, property entrepreneurs and buy-to-let investors, are expecting a record number of visitors when it is held at Manchester&#39s G-MEX on June 18-20 2004. In response to its popularity and the growing trend for property investors to look north for their next opportunity, the […]

Affordability hits Scottish FTBs

This week we continue our round-Britain tour of the mortgage and housing markets. Halifax figures show Scottish house prices have risen 40% in the past three years and the majority of towns across the country have recorded strong increases over the past 12 months. Scotland escaped the boom and bust and resulting negative equity suffered […]

FSA calms pre-N4 proc fee worries

The Financial Services Authority has calmed industry concerns over the payment of proc fees on pipeline mortgage cases started before Mortgage Day but completed afterwards to brokers or networks which fail to get authorised by October 31. Lenders such as HBOS subsidiary The Mortgage Business were worried they might fall foul of the regulator if […]

Lords question regulation

A House of Lords report examining the accountability of the FSA and other regulators is calling for a dedicated parliamentary committee to be established to scrutinise the regulatory state. This move has been welcomed by brokers in the run-up to mortgage regulation. The report, The Regulatory State: Ensuring its Accountability, raises serious questions about how […]

In Focus image

In Focus — May 2015: private medical insurance market in Germany

Welcome to the latest edition of In Focus. In this issue, Jelf examines the private medical insurance market for employers with expatriate workforces in Germany. This includes the common challenges faced in sourcing appropriate coverage, along with a selection of available solutions. This will be of particular interest to HR/reward decision makers with employees based in Germany. It will assess the cultural norms, risks and backdrop that are relevant to organisations with expatriate staff in this location.