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WARNING - New Section 24 Tax Rules


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WARNING....for all of you who are not aware.

The new Section 24 Tax rules come into force on April 6th.

Here is an example of how it will affect you:

Currently if you have £1000 of rental income and £1000 of mortgage interest then your profit is zero with no tax to pay.

After April if you have £1000 of rental income you cannot offset the mortgage interest payments so your profit is £1000. You have a 20% allowance to offset against profit resulting in a profit of £800.....subject to 20% tax (or 40% if you are a higher rate tax payer). Tax bill will be £160 (or £320).

Substitute your own income & mortgage interest payments to find out how much MORE tax you will be paying.

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