Cherie Blair has spoken at an event organized by Landlord and letting agent groups seeking to overturn Chancellor George Osborne’s planned changes to mortgage interest relief for landlords. The Chancellor’s proposals, introduced in the 2015 Budget and Autumn statements, are intended to eliminate tax exemptions which the Treasury claims are not enjoyed by investors in other asset classes such as shares. Under the proposals, landlords operating as sole traders will be less able to deduct mortgage interest payments when calculating their tax liabilities.
Mrs Blair spoke at the event as council to a legal challenge brought against the Treasury proposals following the failure of a formal Parliamentary petition. The motion started by the Residential Landlord’s Association fell more than thirty-one thousand signatures short of the required hundred thousand to merit debate in Parliament. The failure to exert pressure on the Government using petitions led to a crowdfunding campaign by landlords to finance a legal challenge to overturn the Chancellor’s measures.
Acting as legal council to the complainants through Omnia Strategy, the law firm she founded and chaired, Mrs Blair claims that the Chancellor’s proposed changes warrant a judicial review since they discriminate against landlords according to the European Convention on Human rights. This gives one the right to hold one’s property in a way without unfair taxation. Mrs Blair also purports that the tax changes go against European Union competition laws by favoring large institutions over small individual investors.
Also speaking at the event was the Conservative Life Peer and former member of Parliament Lord Howard Flight who had written a letter to the Government “Why the Government is wrong to attack Buy-to-Let.”
The conference, titled the “Tenant Tax Summit” was held on 9th June at the ILEC Conference Center in Earl’s Court. Sponsorship was provided by various property investors and landlord’s organizations including Platinum Property Partners, Velvoir, the Humber Landlord’s Association and the Residential Landlord’s Association among others.
Two landlords at the center of a legal challenge to Chancellor George Osborne’s tax changes announced in last year’s budget have confirmed that two government departments had provided an “acknowledgement of service”.
The legal challenge to the Treasury’s tax changes was launched by two landlords, Steve Bolton and Chris Cooper, who used a crowdfunding platform to raise sufficient capital to employ Omnia Strategy, a legal firm founded and chaired by Cherie Blair, to seek a judicial review of the Chancellor’s measures.
The legal battle over the Chancellor’s proposed changes to Mortgage Interest Relief follows the failure of a Petition launched by the Residential Landlord’s Association to attract sufficient support to warrant debate in Parliament.
Omnia Strategy, the legal firm founded and chaired by former Prime Minister Tony Blair’s wife, Cherie Blair, has written a formal complaint to HMRC proposing a judicial review of Chancellor George Osborne’s restrictions of deductions of finance costs related to residential property.
The new tax changes, set to be implemented in the autumn of 2017 would limit the ability of landlords operating as sole traders to offset mortgage interest payments from their tax liabilities.
The decision to seek a legal challenge to the Chancellor’s tax changes comes as a formal petition set up by the Residential Landlord’s Association failed to reach the required number of 100,000 signatures to be considered for debate in Parliament.
The legal challenge to the Chancellor’s proposed tax measures was brought by Steve Bolton and Chris Cooper who raised £50,000 in crowd-funding from landlords’ associations to initiate a legal challenge to George Osborne’s tax changes.
Mr Bolton owns around 20 residential and commercial properties is also the founder and owner of Platinum Property Partners, a buy-to-let specialist with a portfolio worth a total of £200million. Mr Cooper is a part-time landlord who is using buy-to-let as part of his pension.
The letter to HMRC lists Miss Blair as one of two legal advisers for the claimants and bases the challenge on several purported breaches of the European Convention on Human Rights. The letter claims that the Chancellor’s measures infringe on one’s right to hold one’s property in a way without unfair taxation and may also go against European Union competition laws by favoring large institutions over small individual investors.
In it’s official response to the petition, the Government has claimed that the tax changes remove tax advantages enjoyed by property investors which are not available to those investing in other asset classes.
A move by a landlord’s organization, the Residential Landlord’s Association to overturn Chancellor George Osborne’s changes to landlord tax exemptions suffered a serious blow as its Parliament petition failed to attract sufficient support.
The petition, “Reverse the planned tax relief restriction on ‘individual landlords’” expired today without reaching the required number of 100,000 signatures necessary to be considered for debate in Parliament closing with only 60,894 signatures.
Begun six months ago, the motion sought to challenge Chancellor George Osborne’s reduction of Mortgage Interest Relief announced in his 2015 Summer Budget and Autumn Statement. However, enough support was obtained to warrant an official statement on the topic whereby the Government rejected claims that the proposed tax changes were unfair. In it’s response the Government added that the tax amendments were partly intended to reduce the tax advantages offered to property investors which were not shared by investors in other assets such as shares. The Government also claimed that only 18 percent of landlords are expected to be affected by the changes which are to be introduced gradually over four years beginning in 2017.
The petition’s sponsors, the Residential Landlord’s Association claimed that the tax changes were unfair and likely to result in higher rents for tenants as landlords seek to offset higher costs by increasing rents.
It is understood that some landlord groups are now seeking a judicial review of the Chancellor’s tax changes.
Two property developers, Steve Bolton, Chairman of Platinum Property Partners, and Chris Cooper are have raised £50,000 through a Twitter crowdfunding campaign to challenge Chancellor George Osborne’s planned tax changes for landlords. Under the Chancellor’s proposals, landlords operating as sole traders would no longer to be able to claim Mortgage Interest Relief when calculating their taxes.
Bolton and Cooper began fundraising towards the end of a Parliamentary Petition launched by the Residential Landlords Association titled: “Reverse the planned tax relief restriction on ‘individual landlords’ which argued that the Chancellor’s plans were unfair to private landlords and may result in higher tenant rents.
The Residential Landlord’s Association petition attracted 60,894 signatures, well short of the required 100,000 necessary for the motion to be considered for debate in Parliament which may leave Court action the only option to challenge the proposed tax changes. The motion did however receive enough support to merit an official response from the Government reiterating the Treasury’s support for implementation of the Chancellor’s measures. In its response the Government claimed that the tax changes were fair and merely removed tax exemptions for property investors which are not enjoyed by those in other asset classes.
Speaking about the Chancellor’s plans, Bolton stated “It’s not clear why the government has chosen to just launch an attack on buy-to-let owner-operators with mortgages. It’s a tax from Alice in Wonderland – truly absurd and divorced from real life. Not only is this tax grab unfair, undemocratic and underhanded, but we believe that it could also be unlawful.”
It is believed that the pair have sought legal advice matter from Omnia Strategy, a legal firm founded and chaired by Cherie Blair.
A landlord’s group has begun a parliament petition to challenge Chancellor George Osbourne’s plans to reduce Mortgate Interest Relief. According to the Chancellor’s proposals,, announced in his 2015 Summer Budget and reiterated in the Autumn statement that year, landlords operating as sole traders would no longer be able to deduct mortgage interest payments to reduce their tax liabilities.
The petition launched by the Residential Landlord’s Association claims that the proposed tax changes will increase costs for landlords and tenants as landlords seek to offset higher tax liabilities by increasing rents. The Association also claims that a report from the Institute for Fiscal Studies released in response to the budget indicates that individual landlords are taxed more heavily than other homeowners even before the Chancellor’s proposed changes come into effect in 2017.
The petition titled: “Reverse the planned tax relief restriction on ‘individual’ landlords” also claims that landlords operating as sole traders incur costs i.e. mortgage interest in the course of operating their business. The Residential Landlord’s Association, RLA, claims that Osborne’s measures will unfairly target such landlords since they would be unable to offset costs in the same manner as sole traders operating in other sectors. The RLA claims that the tax changes will not affect large institutional landlords and companies which buy their properties in cash. Other campaigners however claim that buy-to-let is offered significant tax advantages compared with investors in other assets such as shares.
In order to warrant consideration for debate in Parliament, a formal government petition requires a hundred thousand signatures and ten thousand for the government to respond officially. The petition deadline is 27th January 2016.