Mortgage Interest on PPH allowed against rental property

D

donals mom

Guest
HI Folks,

I'm in a panic now sorry, hope someone can help, I had a house before I got married and when we got married we lived there for 2 years, then we bought a huge 4 bed detached house and decided to rent my house, anyway we had a huge mortgage on our PPH and barely any mortgage on the rental property, when I went to make the return the following year to the tax office the person I was talking to (and cant remember a name) said I could put the interest on the mortgage minus the mortgage interest relief ( on our PPH) as an expense against the rental property cause you should have a mortgage on your rental property (especially since I was trying to pay off the other mortgage as quick as I could while I was living in it) anyway we never switched over mortgages and have been still using the interest on the big mortgage as an expense against the rental property but now my husband is self employed and we needed to get an accountant to do our books and the accountant says we shouldn't have been doing this?
Can anyone shed any light on this for me, please

any help really appreciated
 
Your accountant is correct - you can only claim mortgage interest as an expense on the mortgage related to the rented property.
 
Your accountant is correct, and really any advice that anyone here could give to the contrary would be just speculating.

As the farmer would say, "if wanted to get there I wouldn't start from here" but there's not really much you can do now bar normalising your tax situation. If you were only starting out now there may be something you could have done to maximise the mortgage on your rental property and minimise the one on your home - which may be where yer one in the tax office was driving at - but you've no comeback now.

Just another one for the "take tax advice from qualified professionals and no one else, no matter where they work or what they do, pile" I'm afraid.
 
I also believe your accountant is correct. I cannot imagine any circumstances where the mortgage interest paid on your PPR, gross or net of TRS, can be used as an expense against an investment property, in your case your former home. I'm sorry for the bad news as I see it, but I am of course open to correction.
 
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