Additional borrowing

Hello, I bought the flat for 200k with the mortgage for 140k in 2012 and lived there until 2023. in 2018, I took additional borrrowing of 80k on the property. In 2023, I decided to move and rent this property. at that time in may 2023, when the property was bought into the buy to let business(I start renting), the value of the property was 450k and the mortgage was around 220k. Can I claim interest on whole 220k mortgage? or I could claim interest on only 140k? Thank you,

Hi ,
 

Yes you can claim the interest of the whole mortgage.  The costs of getting a loan or alternative finance to buy a residential property and any interest on such a loan or alternative finance payments can be used to calculate a reduction in your Income Tax.    Please use box 44 on the SA105.  The tax that you pay would be lower by utilising this box.  The reduction is the basic rate value (currently 20%) of the lower of: Finance costs - costs not deducted from rental income in the tax year this will be a proportion of finance costs for the transitional years , plus any finance costs brought forward. Property business profits - the profits of the property business in the tax year after using any brought forward losses. Adjusted total income - the income after losses and reliefs, excluding savings and dividend income , that exceeds your personal allowance. Thank you.

Not HMRC...Incorrect, depends on the purpose of the additional borrowing. You borrowed £140k to buy the property, what was the additional borrowing of £80k used for? If it wasnt for allowable purposes it cannot be claimed.