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Question

Investing in a Property (England)

Mortgage Arrangement Fees

12 May 2018 | 2 comments

Hello,

I am looking to re-mortgage myBTL and understand that the early repayment fees on my current mortgage are not tax deductible but are the arrangement fees for the new mortgage still tax deductible? Many thanks for any advice

Answer

2 Comments

  1. guildy

    Not heard of that before and can’t see why early repayment fees wouldn’t be deductible if they’re “wholly and exclusively” incurred for a business. As far as we’re aware, arrangement fees are deductible, again where it’s incurred for a business.

    However, tax is our weakest subject and is ever changing and often depends entirely on very personal circumstances.

    You could have a word with the tax advisor on our website who offers 10 minutes free consultation for Guild subscribers. They work on the principle they may gain a little work by that offering but there’s no commitment whatsoever.

  2. thehesp

    I believe the answer is yes they are both tax deductible but possibly not against rental income but definitely against Capital Gains Tax when you sell the property
    The rule is if it is an expense involved in a purchase it is always against CGT however in this case it is re-financing and existing property so it is entirely possible it could be set against income now instead of CGT at some point in the future

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