Budget 2008 - The Remittance Basis - Offshore Mortgages
It was previously announced that paying interest out of foreign income would be treated as a remittance with effect from 6 April 2008. Today’s Budget has relaxed this proposal in respect of existing mortgages.
Interest payments on existing mortgages, which are secured on a residential property in the UK, that are funded out of untaxed foreign income will not now be treated as a remittance. This will continue for the remaining period of the loan, or until 5 April 2028 whichever is shorter. If the terms of the loan or further advances are made after 12 March 2008 the grandfathering provisions will stop.
Interest payments on existing mortgages, which are secured on a residential property in the UK, that are funded out of untaxed foreign income will not now be treated as a remittance. This will continue for the remaining period of the loan, or until 5 April 2028 whichever is shorter. If the terms of the loan or further advances are made after 12 March 2008 the grandfathering provisions will stop.
