Question:
Will rental income affect my tax credit, if the mortgage interest cost is
just equal to the rental income?
Arthur Weller Replies:
If the mortgage interest, which is an allowable expense, costs just equal to the rental income, then your net rental income is nil, and your tax credit will not be affected. Income, for tax credit purposes, is calculated in much the same way as for income tax. Only net rental income (income that remains after deducting allowable expenses) counts, not gross rental income(income before deduction of allowable expenses).
