Rental property income

Rental property income

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Hi all

Rental property income 

Is mortgage repayment an allowable expense??? and does it matter if this is a residential or buy to let?

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By Bungo
29th Apr 2015 08:11

No
Mortgage repayments is effectively a transfer of money from one account to another, it has no impact on overall finances. So no it is not tax deductible. Mortgage interest charged by the lender on the other hand, is a charge to the rental business and therefore is tax deductible.

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By MJ-
29th Apr 2015 08:25

Thank you

Exactly my point to the customer who told me that his previous accountant deducted the full mortgage as a tax deductible.

 

I was sure I was right when I said that is not correct, but then was thinking am I wrong.

 

Thanks again 

 

 

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By DMGbus
29th Apr 2015 08:42

Interest only mortgage

If you have an interest only mortgage the so-called "repayments" will include no capital element and so be interest only and so be deductible as an interest cost against the rental income.  

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