Claiming residential mortgage interest against rent

[uknick]

I have two properties. I live in one which has a mortgage against it and this will remain my main residence.

I've just inherited a second which has no mortgage on it.

I want to rent out the inherited property. I don't intend to do any refinancing, i.e. use the rented property to take a mortgage on and then use this to pay off my residential mortgage.

Can I claim the interest element of my residential payment against the rental income?

I thought I couldn't, however a friend says it doesn't matter which property the loan is secured against and pointed me to HMRC document BIM45700.

Is my friend correct?

[uknick]

Eric Mc said:

I used to always think that too but it was pointed out to me here that in certain circumstances, the interest CAN be reclaimed.

Eric

Do you have a pointer to the circumstances, if they are other than already highlighted with regard to using finance raised against the rental property to clear the residential mortgage, within certain restraints.


Thanks

[uknick]

Thanks for all your answers. They do agree with what I thought, i.e. I can only claim relief against a loan related to the rental property.

But as my friend was adamant I thought I'd check.

One thing I did read on a taxation site was a little convoluted to avoid having to take this approach.

It suggested I could claim relief even if I didn't raise funding against the rental property to pay off the residential mortgage. The argument was that because I am allowed to claim relief by doing this I could still do so even if I didn't. I'm not sure I'd want to argue with HMRC that doing nothing could be claimed to be the same as doing something.