Repayment mortgage tagging

Apologies if this has been covered but I couldn’t find anything.
I rent out the house I used to live in so I currently have rental income which is tagged to rent (income).

But what do I tag my mortgage outgoings to? As tax relief is only available on the interest do I split the capital and interest and tag them to separate codes? If so which ones. Also I overpay the mortgage do I tag this to something else? I also overpay my mortgage by more than the rental income so do I need to show this on my accounts as overpayments from proprietor drawings?

Hope that makes sense!

Hi @Paul_McCann

I believe a mortgage would be treated very much like a loan from an accounting perspective. My colleague done a quick guide which can be found at the following link:

However, I’m not an accountant, so it may be best to double check with yours just to be safe.

Thanks for the quick reply.

I may use the loan system and just set up a seperate interest account, as mortgage interest is treated differently (unfortunately!)

The opening balance is showing on my suspense account now, but as its not a lump of cash into my account I cant tag it from my account, any idea where I should put this came from?

As the opening balance is likely to be the value of the loan, you can edit the opening balance journal (Reports >> Journal) and change the 9998 Suspense Account line to the bank account the money was paid into. This will also add a transaction to that bank account and alter the balance, but should reflect the payment made.

For a mortgage however, you may be better tagging to a property nominal to show it’s purchase. I think this is where your accountant will likely be more useful than what I am and will be able to ensure it’s correct for you.

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