Claiming interest on BTL mortgage payments.

fruitdogs

We have never claimed interest back on our BTL mortgage payments. When I phoned the bank, initially they said I couldn't! They are now sending me a form and I'm told I can claim for several years. Does anyone know how long we can claim for? Thanks in advance for any help.

ACG

You claim the interest back through HMRC, it goes down as an expense on your self assessment. You can not (as far as I am aware) claim it back through the bank.

Malmo

Have you not declared the rental income to HMRC via self assessment?

marsman802

I think the rule is 4 years back on claims (just did that for the 10% furnished let allowance).

However the government get to go back as far as they like on unpaid taxes....fair eh?

Thrugelmir

marsman802 wrote: »

However the government get to go back as far as they like on unpaid taxes....fair eh?

Income from all excuses should be declared every year. Never been any different. Ignorance is no excuse when it comes to dealing with the HMRC.

marsman802

But they just changed the claim period from 6 to 4 years. Genuine errors on both sides should be allowable adjustments

fruitdogs

Have always paid our tax on rental income!! HMRC said we don't need to do a self assessment as it's been the same rental for the last 10 years. Our property is also managed by a Letting Agent charging 15%. Thanks for the helpful replies. I'm trying not to adopt the ignorance is no excuse approach by asking on here.

ACG

You do a self assessment for any income received that is not PAYE (there are exceptions but I am pretty sure this is not one of them).

Why would the bank refund you money? They charge interest to make a profit. You only get the interest back as a tax deduction because of government legislation (which is changing in the next year or 2). You fill out a self assessment and on there you put down your expenditure of which interest is (currently) one of. In turn that reduces your tax bill.

fruitdogs

The Bank sends the form to prove you are entitled. If you have paid off your Mortgage once and then re-mortgaged, are you still entitled to the interest relief?

lovinituk

fruitdogs wrote: »

The Bank sends the form to prove you are entitled. If you have paid off your Mortgage once and then re-mortgaged, are you still entitled to the interest relief?

None of this makes sense? Are you sure you haven't got mixed up with interest on savings and the bank is actually sending you an R85?!

You don't need any proof of entitlement to declare mortgage interest as an expense. As above, this is all covered on a tax return.