Early redemption fee (mortgage discharge)- deductible?

[mandarin]

Possibly a silly question.

I wish to change my mortage to one with a better rate. However, I will incurr £1800 in early redemption charges.

Are there any beneficial ways to treat this for tax purposes (if I did this prior or after I was lettting)

Thank you

[Telometer]

Are you letting this property? When acquired? When lived in? When let?

[mandarin]

Afternoon.

It was purchased a few months ago after I ported over a mortgage from a previous property. It is a second home that I lived in for a couple of months. I cannot call it my main home. I was going to live there longer term but am not now and I will rent it out under a tennancy.

The current mortgage terms are not favourable. I could simply change the mortgage now and pay the early redemption charge. However I thought it might be better to do this after I have let the property. I am in no hurry but want to try to do this in the most efficient way possible.

Regadrs

[Telometer]

Expenditure has to be wholly and exclusively for the purposes of your business. Given the mixed nature of the expenditure, I think you would have a hard time proving that the expense was exclusively for the purpose of your lettings business.

I am sure you can see that by moving a remortgage date by 24 hours it would be wholly inequitable that it would move it from 0% to 100% deductible.

There's probably (though I'm happy to be proved wrong) no guidance for this sort of case. I suggest you pro-rate the cost over the period for which you held the mortgage. So if you have held the mortgage 10 years, and 1 month of that relates to the BTL period, claim a deduction for 1/120 of the early-redemption penalty.