One Consultancy Group
One Consultancy Group – Less Tax 4 Landlords Update
Less Tax 4 Landlords is a subsidiary company of the One Consultancy Group focused on working with landlord clients, often referred to as LT4L for short. As of October 2023, LT4L is a legacy brand which has been retired for new business.
Whilst closed for new business, this change has no immediate effect on existing clients. Less Tax 4 Landlords will continue to serve its existing clients, working alongside us to do so.
About Less Tax 4 Landlords
Less Tax 4 Landlords was founded in 2015 to help portfolio landlords and property investors build, run and grow professional property businesses.
The brand was founded as landlords and their tenants wrestled with the impact of government policy. Starting with the announcement of Section 24 by the then chancellor George Osborne – which required many landlords to pay tax on non-existent profits, through to supporting them through significant challenges, including the market fallout following the shortest serving Prime Minister in history.
It is widely covered within the Private Rented Sector (PRS) industry that a growing combination of factors, including legislative reform, has led many landlords to reconsider their approach and ability to operate effectively (if at all) in the market, and how best to protect their livelihoods.
LT4L has worked with many clients who as a result of Section 24, would be charged significantly more in tax than the available funds generated from their rental income, meaning that the tax creates a ‘real’ loss. This is why some commentators have referred to Section 24 as a ‘tax on turnover, not profit’.
LT4L works to help landlord clients remain competitive by running their property portfolio as an efficient business and by providing essential services via our group companies, namely legal, conveyancing, finance, mortgage and accountancy services.
Retiring the Less Tax 4 Landlords brand
Against a background of punitive taxation and wider industry challenges for private landlords, we believe the Less Tax 4 Landlords brand stood out with a lot to offer.
However, for where we are in 2024 the brand name chosen in 2015 feels out of step with the evolution of our wider group business in recent years.
In July 2020, our legal practice was rebranded to One Consultancy Group Legal Solutions and thereafter shortened to OCG Legal. In July 2021 Less Bookkeeping for Landlords was rebranded as OCG Accountants.
In July 2022 we demerged our Mortgage and Financial advice departments within Phare Financial Services and OCG Mortgages was incorporated to transact mortgage business going forwards.
Taking all factors into account and supported by feedback from clients, our internal team, and business contacts, we believe that now is the time to retire the Less Tax 4 Landlords brand for new business.
We believe that our new consultancy arm, One Consultancy Solutions, better represents our services, our ethos, and our journey as a company.
Whilst the launch timetable for this change has been somewhat accelerated by the decisions we have taken since the release of guidance by HMRC (see below), this is something we have been considering for a while as our group business has developed. We see this next step as a continuation of the natural evolution in our business and we thank everyone who has been involved in our business to date.
Hybrid Partnership Arrangements
To help landlords with their goals, Less Tax 4 Landlords consulted on a type of business structure now known in the industry as a Hybrid Partnership arrangement.
On 4th October 2023 HMRC published guidance on Hybrid Partnership arrangements, stating that in its view, as described, they do not work, and that those using such arrangements may have to pay more tax, including interest and the potential for penalties.
As this is (or is similar to) a type of structure that LT4L has used with clients, following the publication of this guidance, Less Tax 4 Landlords has provided advice on potentially impacted partnership structures to current clients only. It has been closed to new business appointments for landlords looking to implement such arrangements and we have been in contact with HMRC to clarify its position on these structures.
The process is still ongoing, and LT4L continues to service and support existing clients whilst aiming to conclude this process as soon as possible, subject to HMRC timescales.
Options for Landlords seeking to improve commercial performance and preserve their legacy
One Consultancy Solutions can discuss with you the best option for your property portfolio. The team can help you with your position, from reviewing the merits of sole and joint ownership through to helping you coordinate and implement strategies such as:
• transferring your business to a limited company,
• setting up a management company and utilising pensions,
• forming partnerships and limited liability partnerships,
• implementing trust & gift arrangements
• and any combination of the above to support your goals, aspirations and succession plans.
Please visit the following link for more information: oneconsultancy.solutions/property-solutions/btl-landlords