The chancellor recently announced changes to how income from rental properties is taxed which will affect landlords who have mortgages on their rental properties. Our useful calculator will show how this will affect you year on year as the changes are phased in. By April 2020 the new tax rules will be fully in place, meaning only basic rate (currently 20%) tax relief is available. For 40% rate payers that means a new 20% tax bill on income up to the value of mortgage interest paid and for 45% rate taxpayers the it’ll be a 25% income tax bill.
It makes sense to ensure you are on the best buy to let mortgage deal to keep your total costs down, and changing the interest rate will show you the effects of this. However it makes sense to speak to one of our expert advisers to make sure you are getting best deal.
There are a number of criteria that must be taken in to account when calculating exactly. These could include but are not limited to:
Your monthly outgoings or regular commitments
Whether your income is a basic salary or includes bonus, commision or overtime
Whether you are self employed
The amount of deposit you have
Your age and whether you are borrowing past your retirement date
The lender however has the final input in to determining how much you can borrow. Each lender has their own criteria and as a broker we are perfectly placed to match you to the right lender for your borrowing requirements.
The calculators do not have the final say in how much you can borrw, your repayments etc., but this is where our expertise and experience in the field come in to play. We can sometimes make available a higher borrowing by taking your personal circumstances in to account.
*all potential borrowing is subject to affordability checks and credit status.
