Buy to let property with mortgage - what can be put against tax

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    Buy to let property with mortgage - what can be put against tax

    Hi.

    We purchased buy to let property with a small 5 year mortgage.

    1. We paid 3% stamp duty on the sale (£4000). Can it be put against tax?
    2. Can we put the mortgage repayments against tax because we heard from our mortgage broker that tax relief is fazed out gradually, and we can put 25% against tax in the first year.

    Thank you.

    #2
    1. No, it counts as part of your acquisition cost and used for calculating the capital gains after you sell the property.

    2. Previously the mortgage loan interest was treated as entirely deductable expense against rental income before arriving at the taxable profit which is taxed at 20% or 40%.

    Now the loan interest as an allowable expense is being reduced by 5% steps ( over 4 years ) from 40% down to 20% level .

    Comment


      #3
      agreed.

      1> stamp duty is offset against rise in value of the asset so offset when you sell if you make a profit.

      2. as Gordon stated there is a reduction against income tax, google will be your friend on this one

      Comment

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