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mortgage offset on rental income?
london_lasher
Posts: 4 Newbie
in Cutting tax
hi quick question.
myself and wife currently live in a flat - mortgage as good as paid off.
we are considering buying a house and renting out our flat rather than selling (due to location and current market)
my question is if i remortgage our flat for say 200k, then use this capital towards the purchase of a house, would i be able to offset the mortgage payments on the 200k mortgage on the flat (capital and/or interest) against the rental payments i would receive.
many thanks.
myself and wife currently live in a flat - mortgage as good as paid off.
we are considering buying a house and renting out our flat rather than selling (due to location and current market)
my question is if i remortgage our flat for say 200k, then use this capital towards the purchase of a house, would i be able to offset the mortgage payments on the 200k mortgage on the flat (capital and/or interest) against the rental payments i would receive.
many thanks.
0
Comments
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Yes, providing the value of the property when it is first rented is greater than the debt outstanding. Makes sense as you'll be able to deduct the interest from your rental income before paying tax on the profit.0
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Er no - you can only deduct interest payments not capital from your income. I think you should speak to a tax advsior. Brian - where did you get this rule about "the value of the property when it is first rented is greater than the debt outstanding" from?Paying down the mortgage:
At 1 October 2011: £226,000
Currently: £224,499
Aim: 85% LTV (£212,500)
Paid £1,500
Target remaining: 88.89%0
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