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Loan restructuring

Tax relief for the payment of mortgage interest was generally abolished from April 6, 2000.

However, for anyone running their own business where they have credit balance loan or capital or current accounts, it will be worth investigating whether it is poss-ible to release funds from the business to repay those outstanding accounts to facilitate repayment of a mortgage, the interest on which no longer qualifies for relief.

If the business subsequently needs money, then any interest payable on any fresh borrowing that may be required for business purposes and which may only, in effect, replace previous borrowing, would usually qualify for tax relief.

There is an anti-avoidance provision in the shape of section 787 ICTA 1988 but it would seem that this is rarely, if ever, applied in this context. That is not to say that it would not be, though.

However, provided that no increase in interest rate results from the restructuring, there should be no loss even if interest relief is denied.

It is essential that the taxpayer&#39s accountant is fully engaged in and consulted on this process before any of the suggested processes are carried out.


Pinnacle Insurance – Optident

Thursday, March 7, 2002Type: Healthcare cash planMinimum premium: £6.50 a month, £78 a yearMinimum-maximum ages: 18-80Maximum benefit: Optical £370, dental £500, accidental dental£10,000, emergency dental £600, eye test £20Deferred period: Six monthsCommission: Subject to negotiationTel: 020 8731 3687

Taking advantage of the retirement annuity rules

Retirement annuity contracts are not subject to the new defined-contribution tax regime rules but retain their existing tax rules. There are three main areas of consideration for individuals holding retirement annuity contracts.Ability to pay higher contributions than to a defined-contribution tax regime schemeAlthough higher contributions may normally be paid to a defined-contribution tax regime scheme, […]

A botched pot never boils

I am approaching retirement at age 60 with substantial amounts in pension funds accumulated over the last 25 years.Only a few years ago, it seemed an adequate income would be available from conventional annuities but I have read alarming stories of falling returns and the risks associated with alternatives such as unit-linked and drawdown annuities. […]

Scottish Mutual – Income and Growth Plan 2

Monday, March 4, 2002 Type: Capital protected Isa Aim: Income or growth by investing in Quaich Investments 2 Minimum-maximum investment: £7,000-£500,000 Investment choice: Dublin based company Term: Five years two months Guarantee: Capital returned in full at end of term provided the Dow Jones Eurostoxx 50 does not fall by more than 20% Return: Choice […]

InFocus - thumbnail

In Focus — February 2015

Jelf Employee Benefits looks at the issue of paying anaesthetist fees when the patient had no chance to discuss or agree to them prior to care; and provides recommendations for avoiding this scenario.


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