Mortgage Interest Relief Query

[ancapall]

Apologies if this has been answered before but I cannot find any clear answer in forum.

Myself and my wife bought our first house in 2004 as FTBs. In 2010 we moved into new house as family grew and rented out first house (ideally would have sold but in negative equity so not an option). Once we moved and registered first house with PTRB we lost the mortgage interest relief on the house.

However, over weekend I saw an article in Sunday Times which seemed to imply that the mortgage interest relief follows the owner and not the house. So question is, do we still qualify for mortgage interest relief on the first house? We currently have to subsidise the rent on the first house so any interest relief would be a great help.

Thanks

 

[huskerdu]

You definitely do not qualify for Mortgage tax relief on your first house, as it is only available for your PPR.

Are you currently getting Mortgage tax relief for your PPR ?

 

[ancapall]

Thanks for response huskerdu. No we're not getting any mortgage interest relief for our current PPR - should we be?

 

[cbyr1983]

Thanks for response huskerdu. No we're not getting any mortgage interest relief for our current PPR - should we be?

Yes, you should, but on a non-FTB basis. The allowances are much lower.

I hate to say it, but you could have a liability there as you've been receiving TRS on your non-PPR based on FTB rates and the non-FTB rates you might be due back on your new PPS could be lower.

I have seen people ignore tax issues in the past and they've come back to bite them so I would suggest you try to regularise your affairs but that is your decision at the end of the day.

There is lots of information on de-registering your non-PPR for TRS and re-registering your new PPR on the Revenue website.
I believe the de-registration is done in paper format, the registration of your new mortgage can be done on-line.

And

Just in case you're not familiar with it, your rental income is also subject to income tax. Only part of the interest on the qualifying mortgage can be deducted from the income, the principal repayments can't. Therefore even if there is a shortfall on the monthly payments you can have an income tax liability.

If this concerns you, I'm sure people on the forum can provide advice on how to register for income tax and so on.

 

[huskerdu]

I hate to say it, but you could have a liability there as you've been receiving TRS on your non-PPR based on FTB rates and the non-FTB rates you might be due back on your new PPS could be lower.

The OP did say that they have not been getting mortgage interest relief on their first house since they moved out, so they shouldn't have a liability there.

 

[cbyr1983]

The OP did say that they have not been getting mortgage interest relief on their first house since they moved out, so they shouldn't have a liability there.

Oops - I see it now. I thought you had to actively de-register with Revenue, as PRTB not involved, but it seems you've done it so ignore my last post so if you are deregistered already on your non-PPR.

Simply go online and re-register for your new house and be sure to get the money you're due.