Reporting first year losses

I have just started a BTL property business and all properties are registered to me (Individual). In the first year, I will be making a substantial losses due to changes on the new Renting Homes Wales Act. For example: Rental Income £20,000 Expenses -£35,000 ----------------- Profit / Loss -£15,000 My expenses, exclude mortgage interest payments of £8000. 1. How do I report this in my self assessment tax return? 2. How do I claim this years' Tax Relief on Mortgage interest (20%, £1600) ? Should it be deducted from this year's Profit / Loss Balance? Many Thanks

Hi,

Mortgage interest is claimed as a 'residential property finance cost' in box 44 of SA105. The relief is given at the rate of 20% and is seen as a deduction to the tax liability in the Self Assessment Tax calculation. It is not deducted from the profit / loss balance.

Thank you.