Another twist on rented property

Bowmore · Postby **Bowmore** » Mon Jul 07, 2008 3:25 am

Hi

I have a family home in Berkshire but work in Exeter where I bought a flat to live in during the week. I financed the flat by extending borrowing on the family home. I may soon have to move again and because of the current market conditions, I propose to rent the flat.

Because the loan is secured on the family home, will I be able to allow interest charges against the rental income from the flat or must I get a buy to let mortgage on the flat to be able to claim the allowance ?

This would be more expensive but cheaper than paying the tax.

Thanks

Scooby7 · Postby **Scooby7** » Mon Jul 07, 2008 4:54 am

You should be OK - it isn't what surity you give, but the purpose for which you borrowed the money.

You need to be able to show that the extra borrowings went directly to buying the 2nd house

Bowmore · Postby **Bowmore** » Mon Jul 07, 2008 4:58 am

Thanks Scooby7

cranleys · Postby **cranleys** » Sun Jul 13, 2008 2:41 pm

Bowmore

I would recommend you have the flat valued for when you move out as this may be needed for your claim for the interest to be allowable.

Colin Davison
Property tax advisor
colin@cranleys.co.uk
+44 1256 830000