This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies. To find out more about cookies on this website and how to delete cookies, see our Cookie Policy.

Tools which collect anonymous data to enable us to see how visitors use our site and how it performs. We use this to improve our products, services and user experience.


Tools that enable essential services and functionality, including identity verification, service continuity and site security.

Where Taxpayers and Advisers Meet
Tax Insider Tip: Stamp Duty Land Tax – Portfolio Mortgages
09/12/2016, by Tax Insider, Tax Tips - Property Tax
Rating: 0/5 from 0 people

Tax relief is allowed on interest paid on mortgages/loans taken out to finance the purchase of assets held within a business. Landlords who own two or more properties are deemed to own a ‘portfolio’ of business assets.

Lenders have designed products that treat the ‘portfolio’ as one single business account regardless of the number of properties purchased or whether the full amount of capital has been utilised. The individual properties may have separate mortgages each with different interest rates charged but the ‘portfolio’ is treated as one single business account. ‘One portfolio’ means one agreement, one monthly payment and one mortgage statement.

Should not all of the capital be used, tax relief on interest payments is still fully allowable because the original reason for the mortgage/loan remains, namely to finance the use of capital by a property business.

However, if the capital amount exceeds the value of the property when first let the interest on the amount by which it is exceeded is disallowed.

As from 6 April 2017 tax relief at higher rates on interest paid is being phased out over a four-year period such that by the tax year 2020/21 only basic rate relief will be claimable as an income tax reduction (see Tip 18).

Avril owns six properties with a total value of £2m. With a portfolio mortgage outstanding of £1.7m there is a ‘shortfall’ of £300,000. This amount is not the equity found in any one property, but in the portfolio spread over the six properties.

Therefore £300,000 is available for further investment. The interest is tax deductible in full in 2016/17, reducing over a four-year period such that basic rate relief only is available for 2020/21 onwards.

This is a sample tip taken from our 112 page guide:

101 Tax Tips For Landlords 2016/17

About The Author

The above article is taken from 'Tax Insider,' TaxationWeb's own publication specifically for taxpayers and their advisors. 'Tax Insider' is a monthly magazine containing numerous tax tips, articles, questions and answers from leading tax experts, aimed at helping taxpayers to save tax and reduce their liabilities.

To register and download free copies of Tax Insider, and for details of special offers and how to order, visit:

Back to Tax Tips

Please register or log in to add comments.

There are not comments added

Tony Talks - 


Tony Margaritelli discusses what the 2020's will hold for Accountants in his latest in practice blog.