Buy to let landlords are moving their mortgage debt from their residential properties to rental investments to take advantage of the tax subsidies, claims an investigative journalism website.
The Metro story based on a study from Exaronews.com said the subsidy is helping to inflate house prices and saving landlords £2bn a year in tax benefits, which is an average of £1,400 per property.
The website suggests millionaires are using the mortgage interest loophole to cut their tax bills down to zero.
The Treasury has no intention of stopping buy-to-let investors from deducting mortgage interest from earnings, confirmed the story.
A spokesman from HM Revenue & Customs said: “There is no such thing as a buy-to-let tax break. It is simply a business cost which is a claim against tax, the same as any other business.”
