Remortgaging now rented former PPR to buy foreign investment property?

C

cosy

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I've moved into my new house last year and did not sell my existing home mainly due to the fact that I had no mortgage on it. I did up the old house and rented it in March of this year. I was looking at buying a property in France and was wondering could I get an interest only mortgage on my old house to purchase in France? This would make sense if I could write off the Interest against my rental income before I made a return to revenue next year. Thanks in Advance.
 
Re: Interest Only Mortgage

cosy said:
I've moved into my new house last year and did not sell my existing home mainly due to the fact that I had no mortgage on it. I did up the old house and rented it in March of this year.
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I presume you know that if you rented the former home out within five years of purchase then you are liable for a clawback of stamp duty? See in case this is relevant.
 
Cosy

You can only write off interest against rental income if the amount was used to either purchase the house or carry out works on the house. You cannot claim relief on interest resulting from a remortgage for other purposes.
 
Cosy,

If you bought another investment property in Ireland with the remortgaged money then you can offset the mortgage interest against the rental income from the new property. If you have a rental loss (ie interest, expenses & capital allowances exceed rent)on that new property then you can offset that rental loss against your rental profit on your first investment property.

Foreign properties are treated separately. ie you cannot offset a rental loss/s on foreign properties against Irish property rental profits.
 
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