OPEN - ESDS

Interest only mortgage paymant Qs. 32-34
It is important to know whether the interest recorded at Q. 32 includes an amount
for an insurance premium on the nmrt qaqe capita .- l/Drincipal. .
an entry at Q. 32, Q’s 34(a)-(d) MUST be answered.
Therefore if there is
If the mortgage capital/principal is not covsred by an
please epecify in full how the mortgage capital/principal
NOte that yaar insurance taken out is requirad at Q34( d)
endowment policy (Q. 34)
is covsred.
Interest snd capital/principal mortgags payment Qs. 35-37
Interest at Q37 iB required for the LAST YSAR for which the informsnt has figures.
The informstion wi 11 normally be a vsilable on a statement pro vialed by the
mortgaging company.
Because the information is not current or may not cover a full year it is necessary
to record dates covsred by smount. Where there is more than one mortgage for house
purchase, enter details of other mortgages in left hand rargin.
Although the interest payment recorded at Q. 38 may ha for a tax period some while
before the day of interview, it is essential that you obtain, at Q. 35, the last
payment made before interview.
HCSVmany years has the mortgage run/to run Qs 38 s 39
These are asked of those whose last payment covsred interest and capital/principal
(Q35).
Mortgage payment, standard tax relief dsducted Q. 40
When interest is paid on a mortgage the mortgagee can obtain tax relief on that
interest.
up to April 1983 the tax relief was always obtained by a reduction in income tax
paid. This was by means of PAYE coding for employees or tax iisses.s!nentfor
self-employed. Now tax relief can ba obtained by a reduction in mnrtgage payments.
With interest only mortgsges the interest payment will have bsen reduced by the
current standard (or basic) tsx rate (29% at time of writing). Where interest and
principal payments ba w bsen made the reduction will have baen on the interest
element only.
Additions to mortgsge in last payment Q. 41
Somstimes, in addition to mortgage repayments, a mortgage protection pclicy is
taken out with an insurance company so that in the event of death there is
ausilable a sum of money to pay off the outstanding !wrtgage. This arrangement
should not be confused with the endowment policy described above at Q. 32. A
mortgage protection policy is to pay off the outstanding mortgage in the evsnt of
death of the mortgagse. It is possible
mortgage protection policy.
to ha vs an endowment based mortgage —
and a