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David advised me on consolidating my defined benefit and defined contribution pensions into one fund. It was a very complicated technical exercise which David guided me through with the utmost professionalism and integrity. He dealt with all the parties and kept me informed along the way including explaining deeply technical issues in a straightforward, understandable manner. I have no hesitation in recommending David.

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David manages my investments in a pension fund which is not my area of expertise, it's extremely reassuring to have found a financial advisor I can trust implicitly. I find David extremely approachable, knowledgeable and completely up to date with all the complexities that surround pensions and investments. As he says, 'no question is a stupid question', I feel completely at ease to ask him anything or express any concerns I might have. I always come away from my annual review feeling informed and reassured that my investments are in the best possible hands. David's office is a welcome beacon, relaxing and he makes a great cup of coffee!

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David has managed our financial affairs and investments for many years and we could not have chosen a better independent financial advisor. He is always available to answer our questions or give advice and we come away from our annual meeting knowing our investments are in safe hands. We cannot recommend Ferry Financial highly enough.

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David has been our financial advisor for 15 years and we have always been very pleased with his handling of our finances. He is always at the other end of the phone when we need him. I have no hesitation in recommending Ferry Financial.

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David has managed my investments for a number of years. The advice given by David is always clear, concise and understandable. He has a in-depth knowledge around the complexities of pension management and is happy to spend time talking through different scenarios. David is always available to answer any questions I may have and I come away from our discussions with a clear understanding of my options moving forward. As well as his technical expertise David is just a nice person to do business with and that makes a big difference in my book. I would be certainly be happy to recommend David to any of my friends or colleagues.

Kevin L

David helped us to consolidate our various pensions into SIPPs so we now have a greater understanding of how much we have in our retirement funds. David offers a first class service – he is always readily available to talk and deals with our requirements promptly and efficiency. It is very refreshing to have a personal service which is sadly lacking in the current culture of call centres. We have known David for over 12 years and we highly recommend him as a trusted Advisor.

Brendan and Jayne B

Flipping Houses

Date Published:20/08/2009
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Over the recent past, there cannot be a single person who has not heard about MPs ‘flipping’ their homes in order to gain benefits, including lower tax bills upon sale of their properties.

Apart from the shape of the political landscape changing, one of the consequences of these revelations could be that the rules on nominating which property is an individual’s main residence are tightened up.

This is a little bizarre as it will be the Government, and therefore MPs, who will introduce these changes to block the loophole that has been used by MPs to such great effect.

It will be interesting to see the queue of turkeys lined up to cast their votes in favour of Christmas!

It’s going to be a great shame if these rules do disappear, or change substantially, as many members of the normal tax-paying public will ultimately end up suffering.

The MPs’ expenses, claimed so that the rest of the taxpaying public end up covering the cost of home renovations, swimming pool maintenance and the well publicised duck house really shouldn’t have ever been allowed and must never be allowed to happen again.

So, how do the current tax rules actually work?

It’s pretty simple really. If you own two homes, as many do, and they can both be used by you as your main residence, all you need to do is nominate the ‘other home’ as your main residence for even a relatively short time.

What this then means is that you will get the benefit of this house being treated as your main home for an additional three years.

Here’s an example of how this works in practice:

William owns a house in Stratford which he has elected as his main residence but also has a Welsh cottage he has owned for five years and now wants to sell in six months time, and which has gone up in value from £150,000 to £200,000 in that time. Without planning William could find himself facing a tax bill of up to £9,000.

However, if William altered the election in favour of the cottage even for the next six months and then flipped back to his Stratford property, for that six month period the cottage will be regarded as his main home and will therefore qualify for the three-year relief. This means that instead of having a tax liability on £50,000, £31,818 will drop out of account, leaving William with a chargeable capital gain of £18,182, and a maximum tax bill of £3,272. The minimum tax bill could be nil, dependent on his personal circumstances.

At present the rules state that when William sells the Stratford home, he loses the tax relief on it, but only for the period he flipped it – in this case, 6 months. However, the gain reflecting this period of ownership could be covered by his annual Capital Gains Tax exemption for the year in which he sells, meaning he has no tax to pay.

Another quirk of the current rules is that you do not have to actually spend most of your time in your main home. You only have to actually use it as a residence and have proof of this fact.

Anyone with two homes should seek advice from their financial planner and tax adviser on their own position, in order to take advantage of the rules that currently exist for all; they’re not just there for MPs!!