Help to buy scheme and contracting

Steedie

Steedie

Steedie

Man of Honour
Joined
29 Jun 2004
Posts
21,635
Location
Oxfordshire
Hey guys,

Looking to sign up to the help to buy scheme for Oxfordshire and surrounding areas as I've finally got sick of being charged ridiculous rent prices where I am, currently paying £1000 for a 2 bed house which granted isn't as much as people in London, is still pretty ridiculous.

One question I had is it mentions that you can only apply if your household earns less than £60,000. I'm contracting and earn above this, but obviously due to the way contracting works I only technically earn minimum wage (boo hiss) and a basic salary which is far less. Would I only list my salary? Or do I have to declare my salary as the amount including dividends/expenses etc? As obviously if I do, I may as well not bother with this form :p

I'm expecting some people to say "if you're earning so much why do you need the help to buy scheme?", which is a fair question. But living in Oxfordshire means I'm looking at £350k plus for the house I'd need for my family, so getting a deposit is still tough as a first time buyer

Thanks in advance for any help/input :)
 
how is getting a deposit tough if you're contracting... just don't spend so much and you'll have your deposit fairly quickly

I'd assume it is based on all your income rather than salary - why not just pay yourself <60k in salary+dividends for the relevant period before you buy the property and just leave the rest as cash in your ltd company?
 
I think the idea is that if you are earning over £60,000 a year you don't need to rely on government handouts to buy a house - with that level of income you can surely scrape some sort of deposit together?! Trying to engineer your finances so it looks like you earn less than you do to qualify for the scheme probably isn't sensible.

As a contractor you are presumably far more mobile than any other type of worker would be as well....
 
Because my girlfriend isn't working at the moment and staying at home with our son so I'm paying the rent/bills by myself at the moment. So yes I'm saving a lot each month towards a deposit, but I'd like a 20-30% deposit if I'm buying outside of a scheme to get a good mortgage, which will take a couple of years yet

So using a help to buy scheme to get on the ladder seems like a good idea :)

I wasn't trying to fiddle the system, just when I declare my salary I technically have to put my salary before dividends according to my accountant, but I didn't want to do that then get in trouble later :(

Fox - Yes I could move out of the area, but my girlfriends family are all here, my family are all here. All my friends are here and I've grown up here so I'd like to stay
 
Steedie said:
So using a help to buy scheme to get on the ladder seems like a good idea :)
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It's about as good idea an as claiming income support, housing benefit or JSA at the same time, 'cos you earn too much for those, too :p

I wasn't trying to fiddle the system, just when I declare my salary I technically have to put my salary before dividends according to my accountant, but I didn't want to do that then get in trouble later
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But the only reason you do that is to reduce your tax liability! You don't earn minimum wage, you just declare you do in order to pay less tax. That's why you take dividends, no other reason. If it wasn't that you'd take the whole lot as salary. Not that I disagree with this approach, it's sensible and rational, but come on...

Income is income, just not salary - so income from investments etc is included.

Help to Buy is for struggling families on low wages...
 
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I agree, but...oh okay

Damnit, David Cameron needs to take more money from the damn poor already so I can get a house today and not tomorrow!








Not serious
 
just cap your dividend take to keep your income sub £60k and let it build up in the business savings account?

Then take a really nice dividend at a later date after you're moved in etc :p
 
Help to buy is available for property up to £600k, that is not "struggling families" territory. It simply enables builders to vastly overprice their stock due to people being able to buy with a subsidy, as opposed to what they could afford from their own pocket.

Take a look at the Barratt website and see how "little" you can borrow without this ridiculous bung to the house builders. If everyone couldn't use HTB, the value of building land and new build would have dropped like a stone
 
You'll also be able to borrow less as the multiple will be on whatever you declare (typically 4x your earnings I believe).

This scheme isn't particularly great anyway in my opinion.
 
I know the Help To Buy scheme has different rules for new-build and existing properties. I've just used the HTB scheme to get a new build house and there was never a problem with me earning over any threshold. Have they changed the rules? Or was my builder/broker just lax in applying the rules?
 
There are multiple Help to Buy schemes. Only the Shared Ownership one has the £60k cap. I wouldn't recommend anyone gets into it either as its almost impossible to get out of and has no benefits.
 
LMAO at all the "OMG you earn over 60k/year, you MUST be able to have a spare £70k laying around" comments... are you people clinically insane or just stupid?

£60k/year after tax is £3500/month take home.

Take into account the cost of a viable family home... £1k/month... coucil tax and bills... another £500/month... food? £500 a month, if you're careful... easily more than that. How about transport to/from work? another £500/month.

So there goes £2.5k of the £3.5k you had to start with... oh... that would *only* take 6-7 years or more to build a desposit if you had no form of life outside the basics, how shockingly easy :rolleyes:

The housing market is insanity at the moment, it's absolutely absurd and the inflation of rental market, paying into someone else's savings account form them is pure insanity. Let alone the requirement for most people to take out a mortgage that'll mean them paying 3-4x the already over-inflated price for the property in nothing but interest.




To the OP: I don't have the experience you're looking for... otherwise I'd happilly help you benefit from these schemes as much as possible. As far as I'm concerned... declare your official salary & only the minimum amount you have to to get the scheme...
 
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Skeeter said:
There are multiple Help to Buy schemes. Only the Shared Ownership one has the £60k cap. I wouldn't recommend anyone gets into it either as its almost impossible to get out of and has no benefits.
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Whats wrong with shared ownership? I know a few people that have done it and have had no problems. Having a place is a benfit no?
 
danielanthony said:
Don't forget that contractors could be getting bent over next year with changes to CGT and IR35, so you could be paying 42% tax rather than 0-10% ;)
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Weren't the changes recently announced and they aren't anywhere near as bad as people were worried about (this time)?
 
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