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i hop sir you are well
sir i have a question from property income in corporation
in case finance pay arise in property income kindly explain treatment of finance cost in corporation tax property income means
for instance Mr,A take loan and purchase rental property this loan interest less 25% property income or not?
kindly explain sir thank for your corporation.If the property is bought for investment purposes then we will deduct the interest payable(accrual basis) from interest income under loan relationship rules. but if the property is for eg. warehouse, used for business purposes then the interest payable will be deducted from trading profit, normally.
sir if am mistaken somewhere do let me know.
The treatment of property finance expense is entirely different in corporation tax to that of income tax. In corporation tax there is no restriction of finance expense but the treatment is as Noah has stated above – full tax relief is given but against interest income NOT property income
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