Offset Personal Mortgage with Ltd Co Retained Profit?

[simdee]

OK I'm sure the title has grabbed your attention and you're thinking "no you can't do it". But wait. What about this?:

Business Offset Mortgage - Bank of Scotland Corporate

And yes I already know about this one:

RBS | Business Offset Service | Help to cut your personal mortgage

which is only for sole-traders and LLPs (who *shouldn't* have much cash in their co. so it's a bit pointless for them anyway).

How could HMRC argue against it? You're not taking money out of your co. You're just getting a poor interest rate (i.e. 0%) on your co's retained profit whilst getting a good interest rate (i.e. 0%) on your personal mortgage. They money is still in the co so you're not taking any undue risk of being unable to pay CT. Does anyone have any thoughts? Any experience of either? I'm looking forward to the replies.

[FarmerPalmer]

That looks to be a business product, i.e. a mortgage for a business, with alinked business account, and not a personal mortage.

[Olly]

[QUOTE=simdee;1152105]OK I'm sure the title has grabbed your attention and you're thinking "no you can't do it". But wait. What about this?QUOTE]

Well, what about "THIS"?

From the RBS site "....run for the full term and once again your business could enjoy large savings in mortgage interest."

Now to repent for your abject and reckless carelessness you need to scour the world until you find a bank that'll let you do it

[SackmanandCo]

It is possible to do this at low cost. Say you have a £100,000 mortgage with a 5% interest rate. Total cost £5,000 a year.

If the Company loans you £100,000 and as long as it is repaid within 9 months of the Company year end, the tax charge would be £1,900 (if you are a 40% taxpayer). There would also be some national insurance to pay, but overall its a good saving.

[Stag Cozier]

It is possible to do this at low cost. Say you have a £100,000 mortgage with a 5% interest rate. Total cost £5,000 a year.

If the Company loans you £100,000 and as long as it is repaid within 9 months of the Company year end, the tax charge would be £1,900 (if you are a 40% taxpayer). There would also be some national insurance to pay, but overall its a good saving.

Where do you suggest finding £100,000 to repay back to the company???

[aceboy]

Where do you suggest finding £100,000 to repay back to the company???

From your personal bank account..

Company loans you 100k, you put that in your personal account to off set the mortgage. then 9 months later you take the money from your personal account and pay it back to the company

[SackmanandCo]

yes, correct. thats the beauty of an offset mortgage

[Stag Cozier]

What's your views to then taking the £100k back out again and doing the same thing each year?

[SackmanandCo]

as long as you follow the rules, you will be fine. This is what I do in my company and I am an accountant! But of course you should be aware that tax rules change frequently and so its important to be up to date.