Refinancing - tax relief on interest for rental properties

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Fazzi
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I understand that individuals can remortgage an individual property and take a larger loan providing the amount of the new loan does not exceed the value of the property at its first rental e,g. property value at its first rental 0.50M, value today say 1.0M, debt outstanding 0.30M. This would allow re-financing to get extra funding of 0.20M to buy personal goods - say a new Merc etc - and to get tax releif on the whole 0.50M.

My question is: whilst this applies to individual properties, is the value at first rental principle applied only to individual properties or can it be applied to a portfolio of properties considered as a whole? If the latter is acceptable to the Inland Revenue, and assuming the above figures apply to ten properties not one (ten x 100k each) can I remortgage just five properties (assuming I get 100% loans) instead of all ten? I am mindful that there are loan arrangement fees for each individual application, and wish to minimise these.

In my case I declare income under self assessment, not as a limited company.


31/03/2008 00:00

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