Tax implications of releasing equity on investment property mortgage

[bpi]

In a situation where an investment property increases in value, what are the tax implications of topping up the interest only investment mortgage? Th reason would be to use the top up to reduce the mortgage on your home?

I have read that mortgage interest is fully deductible from any rental income?

Thanks,
BPI

 

[liteweight]

The interest is fully deductible but the mortgage can only be what you spent buying, refurbishing etc. the investment property. You cannot simply use it to borrow for other things. Well you can... but you can't offset the interest against rental.