NoRegretsCoyote
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And contrary to what some people think, you will not be getting any tax relief on the interest. Although it might be secured on the buy to let, the purpose was not for the purchase of the buy to let, so the interest can't be set off against the rent for tax purposes.
Brendan
Is there Revenue guidance on this?
If you think about it, why would interest on a loan that is used to fund education expenses be deductible in calculating rental profit?
After all, it's not an expense that's incurred for the purposes of the rental property business.
Sure but it's only the cost of finance (aka interest) relating to the purchase, improvement or repair of a rental property that's deductible in calculating taxable rental profit.Interest is the cost of finance.
Hence my example above of how it may be more profitable to sell and buy the house next door to take advantage of tax relief.
Can you be sure that Revenue would agree with this? I'd have my doubts.
Sure but it's only the cost of finance (aka interest) relating to the purchase, improvement or repair of a rental property that's deductible in calculating taxable rental profit.
You can't deduct the cost of finance relating to the purchase, improvement or repair of something else (your car, for example) in calculating taxable rental profit.
I don’t follow.I could understand your logic if only mortgage interest on new builds was deductible. But it's not.
I don’t follow.
I could understand your logic if only mortgage interest on new builds was deductible. But it's not.
Oh course - it's a different business owner/taxpayer!Mortgage interest is deductible once again for the same house once another landlord has purchased it.
Yes but it's the same house!Oh course - it's a different business owner/taxpayer!
You are still focusing on the asset and not the business.Yes but If a house lasts a hundred years the cost of building could be claimed many times over in interest payment deductability.
How about you think about this as if it were a shop or restaurant. And then work out your logic.Yes but it's the same house!
If a house lasts a hundred years the cost of building could be claimed many times over in interest payment deductability.
You are still focusing on the asset and not the business.
All businesses deduct financing costs in calculating their taxable profit. The property rental business is no different.
You can provided the loan is used for the purpose of the property rental business.So why shouldn't I be able to re-mortgage the property and use the interest against tax?
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