Tax Return for BTL Property

Siouxsie32

After filing my tax return isn't the best time to ask this, but I'm hoping someone here can give me the answer.  

So, when you're asked to give "Loans interest and other financial costs" and only a certain amount is tax deductible, should you list the actual costs, or the percentage that's deductible?  For example, tax year 2017-2018 75% of loan interest was allowed to be used.  If, say, the loan interest was £4000, should I have listed £4000 and HMRC's systems work out how much I owe, or should I take the 25% off that amount and list £3000?

Hope someone can help cos I've either overpaid or underpaid depending on the answer - doh! 

Dazed_and_C0nfused

There are separate boxes on the return.

One for the amount which can be claimed as an expense and one for the reminder (which could result in a tax credit against your tax liability).

Siouxsie32

Thanks for replying.  I'm referring to item 26...should I have put my actual interest costs there?  Or should I have put 50% of the actual cost (I believe for tax year 2018-2019, the tax return I just filed, there's tax relief on 50% of the loan interest costs..)

Dazed_and_C0nfused

Only the percentage applicable to that tax year goes in that box.
The other part goes in box 44 (I think).

Siouxsie32

Ah yes, I see it now.  That makes sense...

Thanks for getting back to me so quickly 

oldbikebloke

you must calculate the actual split in £ and put that amount in the relevant boxes 
so for 17/18 it should have been 400 x 75% = 3,000 in the deductions calculation and £1,000 in the remaining box
for 18/19 assuming 4k again it would be 2k and 2k 
perhaps read the guidance and examples?
https: //www.gov.uk/guidance/changes-to-tax-relief-for-residential-landlords-how-its-worked-out-including-case-studies

Siouxsie32

oldbikebloke said:

you must calculate the actual split in £ and put that amount in the relevant boxes 

Thanks, that's what I did...just thought I may have miscalculated.  Was hoping...the tax amount just seemed really high.  I guess it's only going to get higher  

oldbikebloke

Siouxsie32 said:

oldbikebloke said:

you must calculate the actual split in £ and put that amount in the relevant boxes 

Thanks, that's what I did...just thought I may have miscalculated.  Was hoping...the tax amount just seemed really high.  I guess it's only going to get higher  

if you read the link above you will understand how the calculation works so you know why rather than it seeming