Will mortgage interest be allowable?

Question If a couple run a property rental trade as a partnership (this is not a rental business), can all the mortgage interest from April 2017 be allowable against the income? I note that there is no 10% wear and tear allowances available for partnership property trades on the partnership pages. I assume that if the business is run as a trade, then this allowance is not available.

Arthur Weller replies:
If you look at www.gov.uk/hmrc-internal-manuals/property-income-manual/pim1030 you can see that it is very unlikely for the renting out of jointly owned property to be categorised as a partnership trade unless significant additional services are provided. But even if it is a partnership, the restrictions on claiming mortgage interest against rental income from April 2017 will still apply, as long as it is in the business of renting out residential property. With regard to the 10% wear and tear allowance, it is not available for anyone from April 2017 onwards.