Finance Expenses on Property Income Flashcards
1
Q
Tax relief for the costs of financing residential rental property restriction
A
Basic tax rate
2
Q
How is relief given?
A
A basic rate tax deduction from an individual’s income tax liability
3
Q
Where does the basic rate restriction apply?
A
100% of finance costs relating to residential properties
4
Q
Reduction of tax liability for taxpayer incurring mortgage interest expense of £5,000 on a residential property
A
£5,000 * 20% (Basic rate) = £1,000
5
Q
What do these rules apply to?
A
Interest and associated incidental costs (e.g. arrangement fees) on loans
