Original buy to let property cost £250000. Bought with own cash £50,000 and morgage of £200,000. If remortgaging is obtained of £250,000 to replace existing loan of £200000 would all the interest qualify for tax relief or would it be resticted to 200000/250000?
The Inland Revenue website seems to suggest tax relief could be claimed on £250000 ?
Tom Fletcher
Replies (2)
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Yep.
Draw up a balance sheet and you'll see that there is £50K of equity in the business. Refinancing that to £0K of equity is perfectly reasonable.
All the interest is allowable up to the value of the properties at the time they were first introduced into the rental business.
NeilW