Permission to let has lapsed!

Annie1960

mcauley wrote: »

So if they only offset the interest paid - is paying the mortgage considered an expense?

No, your mortgage is not necessarily all an expense. Only the interest element is an expense. If you have an interest only mortgage, then this is an expense.

If you have a repayment mortgage, then the capital repayment is not an expense. The capital part results in a capital gain (or loss) when you sell it, so if you have made money on this you could be liable for Capital Gains Tax.

ANDRUAFER

Ok thanks. Yes it's a repayment mortgage.

lovinituk

If you have no income from other sources then chances are any 'profit' is under your personal tax allowance anyway. However you still need to be completing a tax return yearly.

If you are not earning, I assume you are on benefits? Or is that just another can of worms I am opening?!

m_13

Yes, The Mortgage Works are Nationwide too and offer BTL mortgages.

lovinituk

Quizzical_Squirrel wrote: »

I'm sure you are better informed than I am but I'm surprised as I have a Nationwide BTL mortgage (formerly a residential CTL).
I had to double check my paperwork in a bit of a panic just then! How strange.

My info might be a bit out of date and am happy to be corrected. My wife had a Nationwide retail mortgage on her flat which we got consent to let when she originally moved in with me 12 years or so ago. We stayed on the CTL for as long as possible and then when we moved to a BTL had to do it through UCB Home Loans who are (were?) part of the Nationwide group. We were told a couple of years ago that UCB Home Loans were not taking any new business. We are due to see a financial adviser later this week to discuss getting a better BTL deal so will see if Nationwide comes up as one of the alternatives.

ANDRUAFER

Thanks all.

I am working yes- part time at the moment but returning to full time in a few months. I don't claim any benefits .

lovinituk

mcauley wrote: »

Thanks all.

I am working yes- part time at the moment but returning to full time in a few months. I don't claim any benefits .

So you earn money that uses some or all of your personal tax allowance, therefore you may still owe some tax on the 'income' from your rental proceeds.

silvercar

mcauley wrote: »

So if they only offset the interest paid - is paying the mortgage considered an expense?

The interest that is part of the mortgage payment is considered an expense. As is the interest on any borrowing you took to buy the property that is let. So if you funded the property partly by a loan to pay the deposit, the interest on that is also accepted as an expense (it does not have to be secured on the let property).

You should have let the revenue know that you had this income, see here:

https://www.gov.uk/renting-out-a-property/paying-tax

The government is trying to encourage accidental landlords to conform to the scheme by making it easier to get back into the system if they have previously neglected to declare. See here:

https://www.gov.uk/let-property-campaign

So you have an opportunity to sort the tax situation out without too much difficulty.

ANDRUAFER

Ah ok well that's hopeful, thanks for the link. The loan I borrowed for the deposit is interest free so wouldn't be able to claim for that. When I do a new tax return then shall i include the previous years its already been rented?

ANDRUAFER

Just checked that link- it doesn't look too bad