tax offset from loan to finance BTL flat

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    tax offset from loan to finance BTL flat

    15 years ago, I purchased a BTL property for £300k and financed this with £130K re-mortgage against my home and a £170k BTL 20 year interest only mortgage, (my home mortgage is also an interest only).
    For the past 15 years I have been claiming tax relief on both mortgages, to offset my costs (subject to the new interest rate changers introduced in 2017).
    I have now moved and my new mortgage, with a new provider is now reduced to £100k and is also interest only.
    My question is whether I can still offset my reduced home mortgage costs against my BTL flat as before, my understanding is that I can, as the £130k loan I took out is still implicit in my new mortgage although reduced by £30k.

    #2
    I have two BTL interest only mortgage, which are coming to an end and I need to find another provider.
    Unfortunately, the LTV has changed considerably as the flats have reduced in value and in order to fund another decent mortgage rate I will have to reduce the mortgage amount by £65000 from my savings to get the LTV to 75%.
    My question is regarding the tax implications of the £65,000, I am assuming that this will be deducted from my capital gains calculations when I sell the flats, but can I also claim any tax relief?

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      #3
      Yes to your first question re offsetting against new mortgage.
      Capital gains tax is unaffected by how the property is financed.

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