Analysis Table 6
Print

May 1991

Case 2: An 18 Year Repayment Mortgage

£40,000 Borrowed over 18 Years @ 11.85% p.a.

Analysis Table 6

A

B

C

D

E

F

G

H

I

J

K

L

Year

Gross Cash Flow Out

Interest Paid

Principal Repaid

Interest
Applicable
for Tax
Relief

Tax Relief
on Interest

Tax
Relief on
Premium

Net Cash
Flow Out

@ x% Internal Rate of Return

Tax Relief at 52% p.a.

@ 14.5%

@14.6%

@14.641%

pv

pv

pv

pv

1

5636.48

4740.00

728.48

3200.00

1664.00

10.92

3961.56

3459.88

3456.86

3455.62

 

FV = P(1 + i )n

= £40,000 (1.1185)18

i.e. FV = £300,267.12

2

5636.48

4653.68

814.80

3200.00

1664.00

10.92

3961.56

3021.73

3016.46

3014.30

 

3

5636.48

4557.12

911.36

3200.00

1664.00

10.92

3961.56

2639.06

2632.16

2629.34

 

4

5636.48

4449.12

1019.36

3200.00

1664.00

10.92

3961.56

2304.86

2296.82

2293.54

 

5

5636.48

4328.33

1140.15

3200.00

1664.00

10.92

3961.56

2012.98

2004.21

2000.63

 

6

5636.48

4193.22

1275.26

3200.00

1664.00

10.92

3961.56

1758.06

1748.87

1745.12

 

7

5636.48

4042.11

1426.37

3200.00

1664.00

10.92

3961.56

1535.42

1526.07

1522.25

 

8

5636.48

3873.08

1595.40

3098.46

1611.20

10.92

4014.36

1358.85

1349.40

1345.54

 

9

5636.48

3684.03

1784.45

2947.22

1532.55

10.92

4093.01

1210.02

1200.55

1196.69

 

10

5636.48

3472.57

1995.91

2778.06

1444.59

10.92

4180.97

1079.50

1070.12

1066.30

 

11

5636.48

3236.05

2232.43

2588.84

1346.20

10.92

4279.36

964.98

955.76

952.00

 

12

5636.48

2971.51

2496.97

2377.21

1236.15

10.92

4389.41

864.45

855.44

851.78

 

13

5636.48

2675.62

2792.86

2140.50

1113.06

10.92

4512.50

776.15

767.39

763.83

 

14

5636.48

2344.66

3123.82

1875.73

975.38

10.92

4650.18

698.54

690.06

686.61

 

15

5636.48

1974.49

3493.99

1579.59

821.39

10.92

4804.17

630.28

622.08

618.76

 

16

5636.48

1560.45

3908.03

1248.36

649.15

10.92

4976.41

570.20

562.29

559.08

 

17

5636.48

1097.34

4371.13

877.87

456.49

10.92

5169.07

517.27

509.65

506.56

 

18

5636.48

579.37

4889.11

463.50

241.02

10.92

5384.54

470.60

463.26

460.29

 

PV = pv

25,872.83

25,727.45

25,668.24

yields FV

296,034.75

299,033.51

300,272.44

OK