2 Properties Advise on re-mortgaging one to decrease mortgage on other

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polo1

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Looking for advise on following pls.
Have 2 properties.
PPR - Mortgage 220K (Value around 800K) Variable mortgage
2nd Property - Mortgage of 300K (Tracker over 30 years (25 left) €1308 pm)
Rent - 1250 per month

Thinking of remortgaging rented property up by 100k in order to avoid paying any or little tax on it. Have only just rented this since March so new to all this
Would get a second mortgage of 100k with rate of 2.35 instead of loosing my tracker rate.
In principle bank has approved this so dont think any issue there.
Just wondering if I am re-mortgaging the second property enough so as to avoid paying tax on it.
Also wondering can anyone tell me how much TRS I should be getting per month (married couple) on PPR please
Many thanks for the feedback.
 
I think you're asking can you increase the mortage on your PPR to reduce the mortgage on your rental property - and thereby increasing the mortgage interest relief you get on your PPR mortgage.

Sorry - this has been legislated against. And if you follow the news, the Revenue are checking this at this very moment.
 
polo1 said:
... Also wondering can anyone tell me how much TRS I should be getting per month (married couple) on PPR please...
Click to expand...
polo1 said:
... PPR - Mortgage 220K (Value around 800K) Variable mortgage...
Click to expand...
Your monthly mortgage repayment includes interest and capital. TRS is allowable to first-time buyers on the interest portion of the repayment, on a reducing percentage, for up to a maximum of 7 years.

Without knowing

  1. how the repayment is split between interest and capital
  2. your FTB status and
  3. the number of years into the mortgage
its impossible to say.
 
Setanta12 said:
I think you're asking can you increase the mortage on your PPR to reduce the mortgage on your rental property - and thereby increasing the mortgage interest relief you get on your PPR mortgage.

Sorry - this has been legislated against. And if you follow the news, the Revenue are checking this at this very moment.
Click to expand...

Hi Setanta
What I am looking to do is increase the mortgage on my rented property not my PPR - in order to increase the rented properties interest payments - to avoid paying income tax on the balance iykwim.
 
What I am looking to do is increase the mortgage on my rented property not my PPR - in order to increase the rented properties interest payments - to avoid paying income tax on the balance iykwim.
Click to expand...

Hi Polo1,

You can only claim 75% of the interest on the purchase price of investment property.

If you re-mortgage your investment property, you can only use the amount which you used to purchase or renovate the property as a basis for an interest expense.

You cannot reduce your tax bill by re-mortgaging unless you use to money for capital expenditure on the investment property.

Peter
 
thanks for your replies. I know I can only claim 75% - looks like I cant do it so.
 
What portion of the mortgage payments on the rental income is interest? In addition to the mortgage interest there are many other things you can write off against the rental income so you may not have a tax liability.

And no you cannot remortgage just of the sake of getting tax relief. You can to renovate the house though.
 
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