To Loan or Not to Loan

[MIKEL]

I and my sister are in the process of inheriting our late Mother's house. If I we wished to raise capital ie Re-Mortgage say 25% of the property value to put towards the maintenance of the house and maybe towards a deposit on another for the sole purpose of letting would the interest on the re-mortgage /loan applicable to the inherited house be offsettable against tax.

Or would it as I suspect be only be offsettable against a new venture, ie different property that was indeed purchased by ourselves.

We would welcome your comments please.

Regards

MikeL

[Ian McTernan CTA]

To the extent the funds are used to purchase another property to let, is allowable, and also to the extent the money is spend on refurbishing the exisiting property, can be set against the rental income from that property. If it is just taken and used elsewhere, then no.

Regards.

Ian McTernan CTA
email: ian@imcternan.com