Sec.23 type tax relief - is it worth it ?

C

Collylolly

Guest
Is it worth buying Sec.23 property to obtain tax relief on rental income , or are you paying through the nose for this privelege first day ?. I realise a property should be a good (or bad !) buy in its own right (and not really influenced by tax reliefs ) , but ....... ?? . Any solid advice in this general area of tax reliefs on property would be appreciated. Thanks
 
As far as I'm aware S23 properties are regarded as being over priced and really only worth it if you have other properties making a profit. The tax relief on the S23 can be offset against all rentals. I'm not an expert in this so the above is only my understanding of it.

You don't really give enough detail. Do you own other properties?
 
If you have other properties and can use up the section 23 quickly against these rentals, only then might it be worth it.
 
Thank you both. I have four other properties , two of which I own, and two I am still paying off to the Banks for another 2-3 years .They are all rented out. The two I own are making a profit , one house is breaking even, and one is making a 'loss' (morgage is higher than rent I am receiving).
 
Given your situation, I think S23 might be a good idea for you. In 2 or 3 years, you'll have 4 properties hopefully all rented with little or nothing to offset against tax. Try doing a search on the forum for Section 23...maybe there are people who have done it/raised questions about it before.
 
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