Hello
Client re-mortgages their rental propery,
Can the interest be offset in full against the property's rent regardless of what the advance is used for?
I thought the interest could only be allowed for improvements/renovation, or towards the purchase of another property to rent.
The client incidentally, has only one rental property.
Links to any information on this would be gratefully appreciated.
Thanks
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Replies (2)
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I think that they will be restricted to relief on the interest element payable based upon the market value at the time of letting.
Say, MV @ date of letting £300k; remortgage to £350k, allowed 300/350ths of interest.
Say MV @ date of letting again £300k, original mortgage balance £120k, remortgage to £300k; allowed 300/300ths.
Hope that helps.
Look at
THIS thread.
As above will be allowable on a loan to the value of the property when first let. Interest on any excess over that value borrowed will not be allowable.
What the loan is used for is irrelevant.