Limited company buy to let products have been popular for a number of years now, and a recent report by Hamptons showed that there has been a record number of new incorporations set up for the purpose of holding buy-to-let properties.
There was a total of 41,700 buy-to-let incorporations in 2020 which is an increase of 23 per cent compared with 2019.
Hamptons estimate that around half of all buy-to-let properties are now being held in a limited company compared with close to one in five in 2016.
Purchasing your property through a Special Purpose Vehicle (SPV) limited company can be more tax-efficient allowing you to claim 100% of the mortgage interest as an allowable expense. For many personally owned buyers, this is no longer possible.
What’s more, normal buy to let mortgages are taxed as part of your own personal income. This means you pay capital gains tax (CGT) on any property you sell, and tax on the income you make from rent.
The advantage of a limited company buy to let is that these taxes are at corporation tax rates which is often lower than personal tax rates, (Always seek professional tax advice)
To learn more about limited company mortgages contact our award-winning team on 0208 364 3444 or click the request a call back button below to book a time slot.
Leave a Reply
You must be logged in to post a comment.