Rental property company

Rental property company

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Lease on rental property (residential) been owned by limited company for many years.

Commercially rented out to non related parties.

Client has taken loan and acquired 100% shares in the company from all previous owners.

Wondered if someone could advise if the client can obtain tax relief on the interest on bank loan used to purchase the shares or whether company would be considered to be CIHC by HMRC and so prevented from getting any tax relief.

Thank you in advance for any comments.

Simon

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By User deleted
20th Apr 2014 19:40

Not a CIHC ...

... if tenants are not connected.

CTA 2010 s34(3)

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By Steve Kesby
21st Apr 2014 11:13

Agreed

Just to add that for 2014/15 onwards the definition of CIHC for ITA 2007, s. 383 purposes, will be at s. 393A, which is being inserted by s. 13 of this year's Finance Bill. It's essentially the same definition though.

I imagine that's a precursor to the removal of CTA 2010, s. 34 when the main rate and small profits rate are aligned next year.

I think the definition of CIHC is only of relevance to those two issues.

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