For a UK residential mortgage on your own home, overpayments have no tax implications — there's no tax relief on the interest you'd have paid, and no tax on the money you save. For buy-to-let it's different.
You'll be mortgage-free 6 years 9 months earlier
and save £46,940 in interest.
| Without | With overpay | |
|---|---|---|
| Term | 25 years | 18 years 3 months |
| Total interest | £156,277 | £109,338 |
| You save | £46,940 · 6y 9m |
A lower interest rate could save you thousands more on top. See if you could remortgage to a better deal.
We may receive a commission if you remortgage through a partner broker. This never affects the rate you're offered.
No tax relief on mortgage interest (since 2000). No tax on overpayments or interest saved. Money you save is yours — no reporting required.
Since 2020, UK landlords can't deduct mortgage interest from rental income — instead they get a 20% tax credit on interest paid. Overpaying reduces the interest you pay, which reduces the credit. Higher-rate landlords still come out ahead by overpaying, but the benefit is dampened.
Mortgage interest IS still fully deductible from rental profits inside a company. Overpaying reduces interest, increasing taxable profit. Run the maths carefully — sometimes leaving the mortgage and investing through the company is better.
Important: This article is for general information and is not financial advice. Always speak to a qualified UK mortgage adviser before making decisions about overpayments, remortgaging, or your specific mortgage product.