Refinancing - tax relief on interest for rental properties
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.
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