Interest relief

[Haille]

Mortgage Interest relief. I remortgaged my main residence to purchase an investment property on 2007 which I have let out.Should I wait until end of year to claim interest relief against rental income or should I claim interest relief separately as there is no mortgage on investment propery. The remortgage is on my main residence.

 

[elcato]

Should I wait until end of year to claim interest relief against rental income

I dont understand. You must submit a form 11 for any rental income before October 31st of the year following rental. You can claim relief on the income as long as you are paying interest on a loan for the actual property. I believe you may be able to apportion some of your current mortgage to this but I'm not certain as you probably getting TRS for your current residence.

 

[DerKaiser]

Mortgage Interest relief. I remortgaged my main residence to purchase an investment property on 2007 which I have let out.Should I wait until end of year to claim interest relief against rental income or should I claim interest relief separately as there is no mortgage on investment propery. The remortgage is on my main residence.

If the mortgage is not on the investment property I'd have thought you couldn't offset the interest against the rent.

Maybe I'm overlooking something but remortgaging your home to fund a property investment seems to be a bad idea from a few different angles and I'd be surprised if anyone advised you that it was a good idea

 

[Haille]

To clarify I took out €120,000 remortgage in Aug. 2007 to fund purchase and reovation of investment property[ my original family home] .I got a further €20,000 to finish renovation in 2008.I only succeeded in letting property in Jan .2009.As I had no rental income for 2007 and 2008 I could nt claim for allowance for interest on remortgage.Just wondering is it possible to claim for all interest paid on remortgage since 2007 by just looking for direct relief for payments on my main residence.Not sure if this is clear,Is it possible to just pay tax owing on rental income for 2009 received on investment property separately and claim for interest paid for mortgage on my main residence.
I have a 20 year interest only mortgage from NIB [tracker] LTV less than 50%.

 

[Dreamerb]

My understanding is the following (but really, you probably need to take professional tax advice):

1. If the mortgage was taken out exclusively to fund the purchase and refurbishment of the rental property, then interest on that mortgage - no matter what property it's actually secured on - qualifies as a deductible expense against the rental income.

2. You cannot claim the interest prior to first letting as a deductible expense - Revenue is very clear on this. However, expenses incurred prior to first letting may constitute allowable expenses for the purposes of calculating your capital gains tax liability on ultimate sale of the property. Keep your records.

I'd seriously encourage you to take professional advice. It could save you a lot of headaches in years to come.

... this should be in the property investment forum, by the way.

 

[npgallag]

Anyone know if this applies to switching mortgages on the one house only...as in I am about to purchase my 3rd house and i presume I will have interest relief for the next 7yrs, even though I had it on the previous 2 mortgages...? any ideas..