Mortgage in two parts - only part secured on the buy to let

Two years ago I took out a mortgage on my buy to let. The mortgage broker was able to get me a loan which enabled me to put a loft extension in the property before letting it out. He did so by obtaining me two separate loans - one directly secured against the property, the other (with the same lender) secured against a portfolio of shares. I understand that the interest is not an expense but is now treated as a tax credit at basic rate. A) I had assumed I was only able to claim the part of the mortgage that was directly secured against the property - but I read something on a thread that seemed to imply I could claim for both parts of the mortgage? B) If the answer to (A) is yes - last year there were unused finance costs carried forward. I had only stated the finance costs for the part of the mortgage secured against the property. Can I backdate a claim for the extra finance costs from last year too?

Hi Edmund72,
Thank you for your question.
Expenditure on a loft conversion would be considered to be a Capital expense and not deductible when calculating your rental income profit/loss. Alterations to a building , amounting to reconstruction , is not a repair and is not deductible from profits.
Capital expenditure would be claimed as a deduction from any Capital Gains Tax liability should the property be disposed of.
PIM2030 - Deductions: repairs: is it capital?
Only the interest arising on the portion pof the loans used to purchase the rental property will attract income tax relief.
This applies to both loans , irrespective of the secuity used to obtain the loans.
Should you wish to amend your Self Assessmnet tax return after the 12 month amendment window, a claim for overpayment relief under Sch 1AB TMA1970 should be made:
SACM12150 - Overpayment relief: Form of claims
Thank you.