Mortgage Interest on accruals basis - is MIRAS certificate any use?

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    Mortgage Interest on accruals basis - is MIRAS certificate any use?

    I'm preparing my tax return (late I know). I work on the accruals basis. Part of my procedure is requesting old MIRAS 5 (certificate of interest) from my mortgagees and popping the amounts in appropriate boxes in my spreadsheet, which then feed into boxes on the return. However recent conversation with Platform (co-op) has made me doubt my understanding of the information on this form. Of course MIRAS is redundant so it's difficult to go anywhere and check. So I'd be grateful if I could check my understanding here:

    I understand the form deducts any repayment element of the mortgage, giving an interest only figure - that's fine and obviously useful if you have a repayment mortgage.

    I also assumed that the figure on the form was the total interest charged daily between 06/04/xx and 05/04/xx of any tax year, regardless of what you actually paid. So if you have a complete tax year of mortgage payments, the interest charged and the interest paid will be about the same. But if you take out or pay off a mortgage within a tax year, the form will give you the tax due, even if that's not what you actually paid.

    I took out my mortgage with Platform on 12/03/20. I pay in arrears and my first actual payment was 01/05/20. I've just rung Platform to request a tax certificate to cover the period from 12/03/20 to 05/04/20 but the person I spoke to said they couldn't do that because I hadn't paid anything. I queried what would be the point of requesting a certificate if I could just add up the payments for the year (it's an interest only mortgage) but he didn't know what I was talking about.

    As it happens, I can calculate the figure myself. However, if my understanding of how the certificate works is wrong, it may be that I've uncovered a general error running through my previous returns. I don't think it's a significant enough error to lose sleep over but I am interested so would appreciate any views.

    Many thanks.

    #2
    The MIRAS certificate was made obsolete about 20 years ago. You should get a certificate of tax paid for 2020-2021 around May 2021 from your mortgage lender.

    Comment


      #3
      I understand that. My question is; is a certificate of interest due (accruals) or interest paid (cash)?

      I've looked back at some previous certificates. I can see the certificate is often referred to as a "Certificate of Interest Paid", which would suggest it's interest paid. However both Barclays and Santander refer to, "interest charged ", this wording suggests it's interest due.

      I've always thought it's interest due.

      Comment


        #4
        If you are making monthly payments to your mortgage lender , the words "Certificate of interest charged" to your loan account must mean " accumulated interest paid" within the tax year.

        Comment

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