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BTL Property Mortgage Interest

A Client would like to raise finance on sole name and invest in Limited Company

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Hi Guys,

I have a client who has existing properties which are encumered he would like to raise finance on these properties and loan his SPV Limited company the money so he can purchase more Investment Properties.

Which entity would get the tax relief would he get the tax relief on his sole name or the Investment property.

P.S He is also thinking of upgrading his main residence if he raised the finance on his BTL and extended his Main Residence would he get tax relief.

Thanks in Advance.

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By memyself-eye
15th Aug 2020 20:30

they have motgages on them then.... big?
How long?
What terms
What rates?
So many little info-mation
I thought an SPV was a vehicle from Captain Scarlet and the mysterons

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By Paul Crowley
15th Aug 2020 23:51

Buy let let loan funding is a 1984 question.
HMRC had one opinion, accountants a different opinion. Eventually HMRC agreed with accountants and published that opinion. Then HMRC reverted to an opinion somewhere in the middle and like in 1984 deleted the in between opinion and now pretend it never existed.
For a loan to be considered safe it must not exceed the original cost of the buy to let property.
Or at least that is my now revised opinion on what I think HMRC think

Thanks (1)
By Paul Crowley
15th Aug 2020 23:56

The company only gets tax relief on company loans. It could pay interest to shareholder on a shareholder loan, and get tax relief, but shareholder pays tax on it. This has Admin and tax deducted on the interest paid

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