SPX Posted June 11, 2009 Report Share Posted June 11, 2009 Hello - I wonder if someone can give me a definitive answer. I own a flat which was mortgage free (Flat A). I then took out a buy to let mortgage on Flat A and used the mortgage to purchase another flat (Flat which I live in. I rent out Flat A and live in Flat B. I am receiving contrary advice from people as to whether my buy to let mortgage interest payments qualify for tax relief. I wonder if anyone else is in a similar position and can advice me with regard to the tax situation. Thank you. Regards Link to comment Share on other sites More sharing options...
partrim Posted June 19, 2009 Report Share Posted June 19, 2009 I think that for a definitive answer you need to talk to an accountant! From a 'pub accountants' perspective - the rules changed in 1995. Prior to then you could only get tax relief on loans specifically used for house purchase or improvement. I believe that, since then, if you take out a loan for business reasons then you can off-set the interest against tax, regardless of whether the loan was used directly to the purchase or improve the business asset (i.e. the property). Like I say - talk to an accountant!! Link to comment Share on other sites More sharing options...
plym77 Posted July 29, 2009 Report Share Posted July 29, 2009 I am a qualified chartered tax adviser You can claim mortgage interest relief on a mortgage secured on the BTL, up to the value of the BTL when first introduced to the letting market. If it is secured on the BTL, it does not necessarily have to be used for BTL purposes. Claim for interest: If you bought the property as a BTL, up to the purchase value of the BTL. If you bought it, lived in it and then rented it, the value of the property when first rented it out Hope this helps Regards Sherena Link to comment Share on other sites More sharing options...
Simon Dewsberry Posted August 10, 2009 Report Share Posted August 10, 2009 I am a qualified chartered tax adviser You can claim mortgage interest relief on a mortgage secured on the BTL, up to the value of the BTL when first introduced to the letting market. If it is secured on the BTL, it does not necessarily have to be used for BTL purposes. Claim for interest: If you bought the property as a BTL, up to the purchase value of the BTL. If you bought it, lived in it and then rented it, the value of the property when first rented it out Hope this helps Regards Sherena If you lived in flat A as your main residence at any time this will also be benificial ..........Sharena? Link to comment Share on other sites More sharing options...
plym77 Posted August 13, 2009 Report Share Posted August 13, 2009 agreed. if you have lived in a flat as your main residence, then you could claim: - PPR exemption for the period you lived in it (and if returning, possible deemed occupancy - depending on facts) - PPR exemption for the last 36 months of ownership (by virtue of it having been your ppr at some stage, even if only a month for example) - Lettings relief of (depending on facts and figures) potentially up to £40k per owner (ie, husband and wife = 2 owners = 2 x up to £40k) For CGT, depends on the facts as to how much relief from CGT is available and if the ppr is not clear (ie. two propertioes used at the same time could cause ppr issues) then elections to HMRC should be done. Link to comment Share on other sites More sharing options...
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