Lee Sharpe considers how some landlords are using special arrangements to avoid the ‘section 24’ interest restriction.
Most readers will be familiar with the special restriction on interest relief for ‘dwelling-related loans’ introduced by F(No.2)A 2015, s 24. The relief for finance costs in buy-to-let (BTL) businesses subject to income tax is being progressively restricted to just the basic rate of 20% by disallowing relief in 25% tranches between 2017/18 to 2020/21 and effectively replacing it with an equivalent 20% ‘credit’ against the person’s income tax liability.
The restriction applies to ordinary residential lettings, but not to hotels (trades) or to furnished holiday lettings.
Incorporating the property business
Many readers
