Residential remortgage to fund BTL - Tax relief position

Suggers

Hi,


Could anyone help please or point me in the way of HMRC guidance.


I own my residence outright and am buying a buy to let property. I can either take out a BTL mortgage or take a mortgage on the main family home, my question is if I do the latter will I be able to deduct interest costs from the BTL property for Income Tax purposes?


The position seems very unclear and I cannot find anything that categorically states the position.


For info I understand the risks of default on my main home etc.


Thanks
Lee

Thrugelmir

Yes it is eligible. Providing there's a clear link between the money borrowed and the use the of the funds. The source doesn't really matter.

The question is whether your existing lender will release funds on residential mortgage terms for the purpose of acquiring a BTL. From the lenders perspective there are various issues that arise from your proposal.

Suggers

I don't have a mortgage at the moment so I suppose I can choose one that fits.

dimbo61

You are now starting a business so get some proper advice, use an accountant and mortgage broker who deals in BTL

swindiff

I released money from our residential property to fund a BTL. By doing it this way I could claim tax relief on 100% of the value of the property plus all expenses incurred in the purchase.