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bigduckontax, Accountant
Category: Tax
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, When i remortaged my buy to let, i took out 40k. I was

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, When i remortaged my buy to let, i took out 40k. I was initially going to give thie to my parents to help them move. this now isn't happening. What are the tax implications of this?
, I'm Keith and happy to help you with your question.
As it stands none whatsoever, loans are outside the scope of UK taxation. The only time it kicks in is where interest is involved.
You have increased the loan on your buy to let so technically you can offset any interest payable on the loan, but not any capital element, against any rental income derived.
I do hope I have helped you with your answer.
Customer: replied 3 years ago.

Just to clarify, i increased my borrowings on the buy to let to take out 40k from this mortgage. I could do this because the value of the house had increase in the period between taking out the old buy to let mortgage and taking out the new buy to let mortgage.

i assume i don't have to declare it on my self assessment?

There is nothing to declare unless you begin to earn interest from the 40K extracted in which case there will be an entry needed on the SA100 form. However, most deposit takers deduct tax at the basic rate so majority of people it isn't a problem.
There will, of course, have to be the usual returns to be made in respect of the income from your buy to let activities (and I have told you of the need to deduct the additional interest charges), but you will presumably be used to that.
Customer: replied 3 years ago.

One last question... I of course deduct my interest only payments from my rental income.

With regard to the 40k do you mean i will have to calculate what my interest only payment would have been if i hadn't taken the 40k out and then deduct it from the new payment from it? ie Iets say I would have been paying £400 interest on the mortgage if i hadn't taken out 40 k, but am now paying £700. What do i declare purposes?

Sorry not particularly tax speak savvy.

You would be able to offset GBP 700 against the rental income. In the unlikely possibility of this putting the rental account into loss situation then that loss can be carried forward to future years.
bigduckontax and other Tax Specialists are ready to help you
Thank you support.