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SPV question about claiming mortgage interest

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Mr Ben
Mr Ben
7 Posts
1 Thanks

Hello,

This is a little complicated but here goes...

Background

  1. I have a property NOT in my SPV. It has no mortgage and is worth around £175k. It is currently let and I am not planning to sell it or bring it into my SPV (too much cap gains).
  2. I am about to purchase another property through the SPV for the same value (£175k) and was planning to get a LTD BTL mortgage for 75% LTV.
  3. The best LTD BTL rate I can get is around 3.4% but if it was not a LTD BTL and just a normal BTL I could get a rate of about 2.49% - a big difference when claiming full interest within the SPV.

Question

If I were to remortgage the BTL (Non SPV) property using a normal BTL mortgage and have these funds paid directly into my SPV bank account and then use these funds along with my 25% deposit to purchase the SPV property outright - Would I be able to claim within the SPV the interest on the BTL mortgage?

I would of course not attempt to also claim the interest for the BTL mortgage under the self assessment arrange I have for the remortgaged property.

I hope this makes sense.

I have had conflicting advice from two separate accountants.

Thanks
Mr Ben.

10/03/2019 18:48

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