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AS 2011: Government says maximum liability for newbuild homes scheme will be £1bn

The Government has revealed that its maximum liability for the recently announced mortgage indemnity scheme will be no more than £1bn.

The scheme, announced last week as part of the Govern-ment’s housing strategy, aims to increase the amount of mortgage finance for newbuild homes, allowing up to 100,000 families to buy a property.

It will see housebuilders deposit 3.5 per cent of a property’s sale price into an indemnity fund for seven years, after which they will get their money back, minus any losses.

The Government will underwrite 5.5 per cent of the purchase and the borrower will have to put up a 5 per cent deposit.
The autumn statement this week says: “The Government will take on a contingent liability which will build up in line with purchases under the scheme to a maximum of £1bn.”

Lentune Mortgage Consultancy director Stuart Gregory says: “I think there are more effective ways to use the money. If the Government wants to boost the economy and get the housing market moving, then extending the stamp duty holiday would have made a bigger difference.”



HMRC relaxes pension tax ‘carry forward’ rules

The Government has relaxed pensions tax rules to allow investors who exceed the annual allowance of £50,000 to make higher contributions from previous tax years using ‘carry forward’. Under HM Revenue & Customs rules, investors can ‘carry forward’ unused pension contributions from the previous three tax years to avoid paying an annual allowance charge on […]


Chris Gilchrist: Bad start for FCA over competition rules

Converting the FSA to the FCA should amount to more than changing a letter and shuffling who sits where. MPs agree and so does Lord Turner. But they do not agree on what the objectives of the FCA should be. And if they cannot be clear about that, there is little hope we will end […]

Chancellor to launch new EIS in small firm investment package

A new enterprise investment scheme is expected to be announced in today’s autumn statement offering investors 50 per cent tax relief on money put into new businesses, according to reports. The Guardian says the scheme will start in April and the 50 per cent relief will be offered on the first £100,000 of investment in […]


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