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Mortgage Interest Restriction

[ˈmɔːɡɪʤ ˈɪntrɪst rɪsˈtrɪkʃᵊn]



Mortgage Interest Restriction allows landlords to only be able to claim at the Basic Rate for their finance costs on residential properties.

More detail:

Mortgage Interest Restriction is a policy introduced in 2017 in the United Kingdom that restricts how much tax relief Landlords can claim on their finance costs.

Under this restriction, Landlords can only claim tax relief on mortgage interest repayments at the basic rate of Income Tax. Before, individuals were able to claim at their Marginal Tax Rate. This policy therefore only affects people if they are a higher rate or Additional Rate taxpayer.

If someone has multiple properties, it might be more tax efficient to run their business through a Limited Company.

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