Should I Pay down btl mortgages now tax relief limited?

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

    Should I Pay down btl mortgages now tax relief limited?

    I have 4 buy to let’s bringing in an income of £2890 pcm less £539 interest payments. I have also started work again so will have another income stream of approx £20-£25k after tax. I am considering paying down the mortgages on 3 of the properties but am also conscious of creeping towards to higher tax band. Am very confused about the whole thing and whether making less profit vs making more and paying more tax. Any views?! Happy to give more detail if that helps. Also have £20k savings - should I pay down a mortgage with it or invest it?! Thanks in advance

    #2
    Do you own your own home and is it mortgaged?
    When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
    Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

    Comment


      #3
      jpkeates is indeed correct in his question, before making any capital payments from the BtL's , your primary aim should be to use available capital to reduce any mortgage on your primary residence particularly as there is no tax benefit in the residential loan. If indeed there is no mortgage then yes I would move to reduce the level of indebtedness noting that even if any of the properties become unencumbered you could always , subject to criteria prevailing, raise new monies by a remortgage.

      Comment


        #4
        surely this depends on many things, over and above :

        1. Will you need to raise capital again in the near future? debt .. while section 24 is bad, obtaining debt can be costly, if no plan to get any, then pay it off.

        2. Is the debt cheap? Cheaper than what your savings are earning? some people have very cheap loans and therefor are actually making money saving their hard earned in ISAs, Bonds, other

        3. I could go on ..

        cheers, Les

        Comment

        Latest Activity

        Collapse

        • Reply to Paying Tax and Documentation
          by Section20z
          I don't think you can just divert the income through another family member's account, that could be tax evasion....
          28-05-2020, 21:42 PM
        • Paying Tax and Documentation
          by Cotton
          My query is in two parts

          1. I own a property in my personal name. I purchased this to give a family member some passive income.

          Am i right in saying that as the rent does not come to me, i do not need to notify hmrc of additional rental income? And i do not need to fill in...
          28-05-2020, 06:32 AM
        • Reply to Keeping records for CGT and rental income separate ?
          by theartfullodger
          Good. But it may be an old edition not up to date with all current regulations. It's republished every year...
          28-05-2020, 16:04 PM
        • Keeping records for CGT and rental income separate ?
          by Another Fine Mess
          I recently bought a house to rent out. Am I right in thinking that I should do two sets of accounts.
          Account 1. CGT account, List the purchase price, solicitors fees, stamp duty, and all the repairs we had to do structurally, decorating, carpets, paint windows, etc So if the purchase price...
          22-05-2020, 12:18 PM
        • Reply to Paying Tax and Documentation
          by jpkeates
          If you receive no income from the property you own, you don't have to pay income tax on it, no.
          You may have to pay CGT when you sell it, if there is any significant increase in value.
          28-05-2020, 15:57 PM
        • Reply to Keeping records for CGT and rental income separate ?
          by Always Problems
          theartfullodger,

          Thank you for the advice regarding the Tax.
          I looked up the book you recommended and found one on eBay at £2 delivered and in it my query is answered.
          28-05-2020, 15:09 PM
        • Reply to Paying Tax and Documentation
          by Gordon999
          The Director of the Ltd Company has to file annual returns to Companies House and to HMRC..

          Visit Companies House website, use your company number to find company listing and check due date for filing tax returns . Can be fined if you fail to comply.
          28-05-2020, 14:52 PM
        • Reply to Sell my small garden to my limited company
          by jpkeates
          It just has to really be your PPR, so for most people with one home, it's a no brainer and starts the day they move in.

          The issue is that you need to track all the money flows over the business lifetime.

          The company is going to be paying tax at 19%, and most of what comes out...
          28-05-2020, 08:38 AM
        • Sell my small garden to my limited company
          by yanyan
          I have a PPR property with a side garden that is suitable to build a house on. Can i set up a limited company and sell my garden to that company, at a commerial rate, to allow the limited company to build a rental property? The plot is less than 0.5 acre so assume I will avoid CGT on the sale? Can I...
          27-05-2020, 15:32 PM
        • Reply to Sell my small garden to my limited company
          by yanyan
          Thanks for the response.
          Unfortunately the new property would be smaller than the existing so not really an option, but out of interest is there a minimum period of time you would need to live in new property before you could sell as your PPR legally? Many thanks....
          27-05-2020, 22:09 PM
        Working...
        X