UK buy to let mortgages

[Wales4rugbyWC23]

Good call Ben!! Although I will say this though housing (the shortage and lack of affordability especially down South) in the UK does arise passions much more so than in Japan.

[Cheeseman]

Now this capital gains tax on buy to let is doing my head in...
I get that CG would be payable on gains made while it was a BTL however, if on returning to the UK it became my home and I sold it to buy a different property would I have to pay CG or only after the new property was sold.
Also I read that a property could be nominated as the main home, but the article didn't specify if the properties had to be in UK or if this still counted if one of them was let.

[goodandbadjapan]

This is sort of discussed earlier on the thread. If you have a property which is not your principal home but later becomes your principal home, the CGT will be liable on the gain that has accrued from when you purchased it up until the time it becomes the principal home. Presumably, this is only due once the property is sold, but how they assess the gain when no actual sale was made at the time it became a principal property is anyone's guess!

So you would pay CGT on the old home, not the new one, when the old one was sold, but only for the period in which it was not a principal home.

[Beaglehound]

It’s calculated on a percentage basis of how long it was/was not your principal home. So say you buy for 150k now and rent it out for 10 years, then live in it for a further 10 years before selling for 250k, you would be liable for CGT on half of your gain, i.e. 50k, minus conveyancing costs. The last 18 months that you own it seems to be discounted if it has been your principal residence at some point, which would reduce the liability a little. And there is a personal allowance for CGT which would further reduce it. See this link for more detail.

https://www.which.co.uk/money/tax/capit ... uq96u1500f

[Cheeseman]

The which articles says that you can choose which property to be your principal home so obviously I would choose the UK one over the falling in value Japan house. I can’t find any info on this and wonder if anyone has been through the process.

[Cheeseman]

After ploughing through pages of HMRC capital gains tax documents it would appear that to nominate a property as your main residence does not require you to actually reside there. However, you do need to be in the same tax country as the property.
Darn! But not really surprised.

[Wales4rugbyWC23]

I put up a post up earlier about the process of applying an expat buy to let mortgage in the UK. I am glad to say that I finally got approval from the Building society, this was five months after the original application..... My house loan application with Mitsui Sumitomi for my Japanese house took five days.... All that can be said is that it is a bureaucratical nightmare and be prepared to be asked for every document related to your finances and salary over the last three years. Three times I had to scan and send my salary slips for different months. I have been through this process before and it was so much more easier. All Mitsui Sumitomi wanted was three years of tax returns. However, the long wait was worth it, they gave me an interest rate of 2.74%, which is 1% lower than I am paying now on my other buy to let. It seems likely that interest rates might be cut at the end of the month by the Bank of England.

[Cheeseman]

Wales4rugby..
Congratulations!
I bought a place 19 years ago as an ex-pat. I had a 25% down payment and had to fight off lenders with a dirty stick!
This time I had a 50% deposit but found the loan application procedure to be a nightmare, copies, translations, more copies of things I no longer have, copies of things I have never had in the first place.....
In the end I gave up.... I made a cash offer for a small 2 bed semi which was, after upping the offer a little, eventually accepted.

[Wales4rugbyWC23]

Wales4rugby..
Congratulations!
I bought a place 19 years ago as an ex-pat. I had a 25% down payment and had to fight off lenders with a dirty stick!
This time I had a 50% deposit but found the loan application procedure to be a nightmare, copies, translations, more copies of things I no longer have, copies of things I have never had in the first place.....
In the end I gave up.... I made a cash offer for a small 2 bed semi which was, after upping the offer a little, eventually accepted.

I did a buy to let eight years ago with the Ipswich building society and it was a walk in the park; 25% deposit, 25,000 pound minimum salary and self-employment. Although I had been rejected from Lloyds earlier. I went through the same specialist broker with the Ipswich building society. This time with the same building society it was a 45% deposit, full time employment only and a minimum of 40,000 pound salary. They only gave me the loan reluctantly because I am a current borrower with them now.... HMRC also want their part of the spoils with 8000 pound stamp duty, before it was only about 2000 pounds.

If you do not mind me asking which building society did you look for taking a mortgage? I am not sure about you but a two bedroom semi where I used to live you do not get much change from 500,000 pounds. I have gone in for one and two bedroom flats where I used to live. Knowing the process now with all the documents they wanted, and the very competitive interest rate they offered, I might try it again with sterling staying low. There doesn't seem to have been much of a Boris bounce with the sterling:Yen exchange rate since the General Election.

[Cheeseman]

I tried Chelsea who my previous mortgage was with and Ipswich, neither liked my employment status being part time. I also contacted a broker in Cheltenham whose best efforts came up with “maybe possible with xxx BS” with rates of 5+%