Are mortgage arrangement fees off-settable against tax?
I was inspired to ask this question based on the article that Mark Alexander wrote this morning about one very arrogant member thinks he who knows it all. The article was entitled “Naive Question From Landlords” [link]
Perhaps he can enlighten me?
The most recent arrangement fee quoted to me for an interest only BTL mortgage was at the top end of the range – £4,000 for a £160,000 mortgage.
I know that interest is off-settable against rental profits but what about arrangement fees?
Many thanks
Ian
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No such thing as the best Buy to Let product
Member Since March 2020 - Comments: 5
3:49 PM, 6th April 2020, About 6 years ago
Thank you Mark, super clear
Member Since January 2011 - Comments: 12193 - Articles: 1396
3:45 AM, 7th April 2020, About 6 years ago
Reply to the comment left by CristinaB at 06/04/2020 – 15:49
Maybe this will help?
https://www.gov.uk/government/publications/restricting-finance-cost-relief-for-individual-landlords/restricting-finance-cost-relief-for-individual-landlords#policy-objective
Member Since March 2020 - Comments: 5
8:52 AM, 7th April 2020, About 6 years ago
Reply to the comment left by Mark Alexander at 07/04/2020 – 03:45
Thank you, very useful. Can I assume if I build the remortgage fee in the mortgage total value (interest only), then I will claim as tax relief the 20% as an overall (including the fee)?
Member Since January 2011 - Comments: 12193 - Articles: 1396
12:56 PM, 7th April 2020, About 6 years ago
Reply to the comment left by CristinaB at 07/04/2020 – 08:52
The 20% tax credit is applied to both the interest and the fee.