tax deductable interest...

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    tax deductable interest...

    My wife and I own a rental property as tenant in common, (99% belongs to her, 1% me) its unencumbered. I understand if we take out a mortgage on the property, the interest costs can be offset against rental income. Also if we can show we have taken other forms of financing to finance this property, I.e. a mortgage on our residential property, we can still offset the interest rates costs against rental income (upto the value of the rental property when it was first used as a rental property).

    My question is, what happens if as above 99% of the property belongs to my wife, yet our residential property on which we are looking to take the mortgage (due to its lower interest rate cost) belongs solely to me. Is the limit of financing I can count towards the rental property 1% of its value (that bit which actually belongs to me) or 100%

    #2
    How can your wife claim loan interest as an expense against her share of rental income if she does not have any mortgage loan in her name?

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      #3
      she is not, I am. The question is as this property is jointly owned can I claim relief based on a loan equal to 100% of the property's value, or becuase my share of the property is only 1% am I limited to 1% of the property's value.

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