Daily Archives: December 27, 2018

MPs seek say on ‘golden visas’

The Cyprus Mail reported………

A LEGISLATIVE proposal is to be tabled to the House plenum in January aiming to give parliament a say in the criteria governing the issuing of passports to foreign nationals under the citizenship-by-investment scheme. The bill, authored by the Greens, is expected to go before the plenary session on January 11, the first session following the Christmas recess.

It stipulates that the criteria for these naturalisations need to be submitted by the government to parliament, before they are published in the government gazette. Currently, the terms and conditions for the citizenship-by-investment programme are determined by the cabinet, with no further scrutiny.

In prior discussions in parliament, the interior ministry said it was opposed to the Greens’ bill, arguing that it would deprive the government of the flexibility in periodically updating or revising the naturalisation scheme. Ruling Disy said also they are against the provisions of the bill, while main opposition Akel are in favour.

The Greens tabled the proposal after another bill they had submitted – mandating the publishing of the names of foreign investors granted passports – failed to muster support in committee. In October, the Organisation for Economic Cooperation and Development placed Cyprus’ so-called ‘golden passport’ programme on a blacklist of schemes identified as posing a threat to international efforts to combat tax evasion.

My opinion

Is this what it has come to? We sold our soul to the EU and now we are prostituting our land for profit, selling off land that was for the main part owned by Cypriots in the past, much of which was placed in the name of the Church for tax reasons under the Ottomans, but was subsequently kept by the church and now, in partnership with corrupt developers, it is being sold off to people who do not have nexus with Cyprus, people who do not care, people who are only interested in gaining a foothold in Europe.

This is yet another shameful scandal for Cyprus, this administration (and those that preceded it) have NO IDEA about implementing effective and unifying Nation building policies, no….they only care about profit and pulling the ladder up, but meanwhile, hardworking Cypriots struggle with pitiful salaries and overpriced property prices created by a bubble that has no logical basis, no form foundations and one that will surely burst, taking down innocent people with it, but the instigators will not suffer, just as the instigators of the crisis that resulted in the THEFT of innocent people’s bank deposits did not affect them.

I feel that this ‘Golden Visa’ policy’ will not end well. Cyprus is a small island and we cannot keep selling off to non-Cypriots, that is not racist, that is not divisive, it is based on a desire to avoid being overrun and pushed out.

What I find to be the greatest tragedy, on the note of Nation building is that there is not and never has been any inclusive policy to unite Cypriots, to make it easier for them to move to Cyprus, live in Cyprus and most importantly offer their children a state English speaking school. In fact, English was actually REMOVED as an official language back in the 80s, making it even harder for Cypriots who are living outside of Cyprus to return.

What saddens me the most, is that this administration is willing to sell its soul to people who have no interest in Cyprus whatsoever, yet they will do NOTHING to encourage a unified Cypriot Demography. If this continues, Cyprus as we know it will cease to exist and one day, those of us who remain will wake up strangers in our own land.

Why we must work to succeed

In a world of ‘Little Princes’ where we as parents do our utmost to give our children a better future than our own, do forget the fundamental factors that dictate true character building? Most of the great success stories have been laid on a foundation of hard work, attempt, followed by failure, followed by another attempt, followed by failure. There is no shame in failing; there is only shame in not making an effort. Failure can be the greatest opportunity to learn in life.

Therefore, if we accept the notion that is learning in failure, character building in hard work then we must also accept that if deny our children (or ourselves) the process of working hard, making an effort, self-depravation and sacrifice, we are ruling out a major part of the character building process. I know that I had a far more privileged life than my parents, who made every effort to prevent me from suffering poverty, or suffering any of the many pitfalls that life can throw our way, but as I approach the last few years of middle age, I can look back and see that in their haste to protect, to guide or even control, their efforts may have had the opposite effect.

It is true that we are all different and as a society it is those differences in character that define us but still unite us on the common road that we must all travel from the womb to the tomb. However, it is an empirical fact that where we deny experiential suffering we deny experiential learning. Sadly, we can become so complacent about longevity that we forget that we are ALL on borrowed time, there is no happy ever after there is no owning of anything, we are all little more than leaseholders. It is not what we have that defines us, it is what we learn and the process by which we gain that knowledge.

Sitting in a lecture at University, discussing ‘Maslow’s Hierarchy of needs’ is not in any way a substitute for learning to get our priorities right the hard way. The reason I selected this speech by Arnold Schwarzenegger is because this is a man who is a quintessential definition of self-sacrifice.  He had nothing, he worked very hard and made time to train religiously, without sponsorship, Steroids or even a personal trainer (at least in his early days) but he did not give up and the rest you know.

My favourite quote in this video

A sports writer asked Muhammad Ali, how many sit ups he did…

Ali replied “I don’t start counting until it hurts”

As we approach the end of 2018, we naturally reflect on the past and look forward to the future and it is with this I would urge you to ask yourselves, what foundations are you laying for your future? What are you doing for your children? Are you teaching them to work hard, overcome failure and try again? Are you giving them the opportunity to understand that there is a price to pay for everything or are you going to allow them to know the price of everything and the value of nothing?

Buy-to-let landlords in for a Tax shock

It’s now three years since the then Conservative Chancellor George Osborne introduced a series of measures aimed, principally, at cooling the overheating London housing market. The inexorable rise of property prices in the Capital threatened to create a financial bubble of potentially devastating proportions whose impact would ripple across the UK when it inevitably burst.

With the effects of the 2008 crash still being felt, the last thing we needed was another recession and the measures were generally seen as sensible. House prices in London were becoming dangerously out-of-step with the rest of the country and something needed to be done. The boom was fuelled by a massive inward flight of capital, mainly by rich investors from the far and middle east and from Russia.

But, as with most macro-economic measures aimed at achieving a political objective, there are unintended consequences and those are now coming back to bite us. The Chancellor, who promised we were “all in it together” at the height of austerity is now, of course, long gone – reclining in the Editor’s chair of the London Evening Standard and tinkering with operations at the many companies with whom he holds six-figure directorships.

And the people left to pick up the pieces are the thousands of small, buy-to-let landlords and potentially tens of thousands of private tenants whose lives are about to be turned upside down, as a result. The first of the punitive tax measures introduced by Osborne to discourage people from investing in residential propertywas a 3% hike in stamp duty (Land and Buildings transaction Tax in Scotland), which was followed quickly by the introduction of stress tests for buy-to-let mortgages.

At the same time, headline rates of Capital Gains Tax (CGT) paid on profits from asset sales were cut from 18% to 10% for basic rate taxpayers and from 28% to 20% for higher rate taxpayers. But it was a third measure – the phasing-out of mortgage interest tax relief on rental income – that will have the most devastating implications when the first tax demands start to land on doormats at the end of next month.

For the first time, landlords will have to pay tax at the upper rate of 50% on income earned on property rental. In some cases,there will be a doubling or even trebling of previous rates paid. HigherIncome Tax bills, due to be paid the day after they arrive, could spell disaster for thousands of landlords across the UK, placing further stress on local authority housing and making many more people homeless.

Research done by Touchstone Education and other organisations suggests that few landlords are aware of the impending changes, contained in Section 24 of the Finance Bill 2015-16 – also known as The Tenant Tax – and even fewer have made any preparations to deal with them. A survey by Tenant Referencing UK earlier this year found that 70% of landlords were unaware of the changes.

The few landlords who do know about the tax rises have been left with no choice but to evict tenants and sell-up or to increase their rents.

Anecdotal evidence from Touchstone Education’s regular Six Figure Summits – at which we offer property investors advice on how to maximise their income – suggests that thousands of landlords have already exited the buy-to-let market, switching their investments into commercial properties or serviced accommodation.

Those who remain,and are unaware of the changes, will have to pay punishingly high tax bills the day after they file Income Tax returns at the end of January and many don’t know they’re sleepwalking towards bankruptcy.

A landlord who attended one of our Six Figure Summits will have to find an extra £120,000 because of the additional tax burden on his property portfolio. His accountant failed to alert him to the changes,but he learned about them elsewhere and now he’s taking steps to deal with it. We’re working with him to find legitimate ways of reducing his exposure.

It was a shock for him but at least he found out in time – there are thousands of others for whom it will be too late, unless they act now. There areseveral HMRC-approved measures that can mitigate the impact of these punitive measures, including claiming capital allowances for residential properties that have been re-designated asserviced accommodation, also known as furnished holiday lets.

We are working with landlords who have been able to claim hundreds of thousands of pounds in capital allowances against their property portfolios, which means they can earn income and pay little or no tax. The highest individual HMRC-approved claim so far is for over £650,000.

Investing in buy-to-let has been a popular way to make money in the past and owners are now having to find ways to diversify. These draconian tax measures shouldn’t mean the end, there are other ways to earn a decent return on residential properties, you just need to know about them.

My year in review

So as 2018 draws to an end, it’s that time of year when we naturally begin to reflect on what he had hoped for, what we had planned and what actually happened. As with all things in life, there is always bad mixed in with the good, and vice versa. We are fortunate to have smartphones with Cameras that take excellent photos and video, but it can all too easily become one big mess of hundreds of clips that end up being uploaded somewhere and forgotten about, or just too many to be practical to ever watch.

That is why I decided to pick out my favourite moments and immortalise them in a short video that highlights my year, and what a year it has been. As always with me, life seems to be a rollercoaster, people come and go, some leave their mark, others leave a trail of disaster, but others remain and stand the test of time. It is these people who have real value in life, sincerity is PRICELESS.

I know first hand how it feels to have people purporting to be friends, but they secretly have an agenda. In fact one such person was working behind the scenes, interfering in my life for a long time before I could actually provide hard evidence to prove it. Imagine a person working on your friends like a Cancer, slowly manipulating them over time, convincing them that a pack of lies is the truth. When I did finally confront them, I lost my friends, because I was angry with what they did and they were angry that I find out (or the methods I used to get evidence) but I’m so glad I uncovered the truth. Sadly in these situations, there is too much collateral damage in the process of uncovering the truth, for there to be any realistic chance of remaining friends, that is very sad.

On a positive note, this year has been a real adventure, with a trip to Amsterdam with my good friend, a trip to Dublin with a group of friends, then a trip to Stockholm for a friend’s birthday as well as several trips to Cyprus. For me, what really matters is quality of life, travel and friends, all the rest is little more than a pipe dream. We are all on borrowed time and we can easily forget that, the only things that have true value are our friends, our feelings and our memories.

Happy New Year 2019