Advice ref paying 10% off wrt New tax rules on BTL

CF49

Good evening
I'm new to the forum and after a bit of advice pls
We have a house up north on a BTL only had it since June last yr. Now we are in a position to pay 10% off but with the tax changes in April not sure if we should
Currently £413 pm mortgage
Could be £375 if pay 10%
Our rent is £550
10% goes straight to letting agent
Is it worth us paying the 10% or would more go to taxman....
any advice appreciated it's wrecking our brains (only property we own)

abby1234519

CF49 wrote: »

Good evening
I'm new to the forum and after a bit of advice pls
We have a house up north on a BTL only had it since June last yr. Now we are in a position to pay 10% off but with the tax changes in April not sure if we should
Currently £413 pm mortgage
Could be £375 if pay 10%
Our rent is £550
10% goes straight to letting agent
Is it worth us paying the 10% or would more go to taxman....
any advice appreciated it's wrecking our brains (only property we own)

I'm no expert, but even if there are tax changes related to the interest relief you'd get, surely overpaying is still a good option? Ultimately you'd be reducing the amount of interest you'll be paying over the course of the mortgage

there is a calculator in this, no idea if it is of any use

foxy-stoat

As of April you can only offset 75% of the interest from your income tax bill, 2018 this will be reduced to 50%, then 25% then by 2020 0%. So paying it off the mortgage will save you money in the long run but you will have slightly more tax to pay.

Thrugelmir

CF49 wrote: »

Currently £413 pm mortgage
Could be £375 if pay 10%
Our rent is £550
10% goes straight to letting agent
Is it worth us paying the 10% or would more go to taxman....
any advice appreciated it's wrecking our brains (only property we own)

Did you crunch the numbers before deciding to become a LL. On the face of it not a particularly good investment. Once all costs are taken into account.

CF49

Thrugelmir wrote: »

Did you crunch the numbers before deciding to become a LL. On the face of it not a particularly good investment. Once all costs are taken into account.

To us it's an good investment whilst my husband is serving therefore someone is paying our mortgage as we would live in this property after the 22yrs. Like so mention in my post it's our only property not gurus in this unfortunately. Thank you appreciate your input

MoneySavingMission

any overpayment will be positive for you.
I agree although you're not making a lot of money, its obviously long term strategy for you.