Buying residential property under Limited Company

[Jessica@WhiteFieldTax]

And mileage every month to drive down and inspect it...

My understanding*1 is that due to health and safety and obligations on landlords, a weekly inspection is advised, nea necessary.

*1 - or so my clients tell me..

[KEH]

Along the same lines

I am looking at setting up a second LTD, purely as an investment engine, the sole purpose of the LTD will be the purchase of BTL properties. My intention is to make a substantial loan to the company, use those funds to purchase a small number of properties (residential and commercial), which will then be renovated and rented. I do not intend to take out a mortgage, and will be buying for cash.
CGT is not a current concern as I do not intend to liquidate. As I also have no intention of drawing salary or dividends from the ltd, I should pay only 26% tax rather than full whack if I were to own the properties myself.
Profit (rental income) will be used for repairs, and further investment.
Once a sufficient warchest has been built up, I could of course begin repaying the initial loan made to the company.......

Or am I being naïve?

[Jessica@WhiteFieldTax]

Crunch your numbers on long term CGT when you do sell, even if its not till post retirement.

Generally the maths works out in favour of personal CGT rates, rather than the potential double tax charge of CT on gains in the company plus personal; CGT on extracting from the company at closure.

[northernladuk]

I am looking at setting up a second LTD, purely as an investment engine, the sole purpose of the LTD will be the purchase of BTL properties. My intention is to make a substantial loan to the company, use those funds to purchase a small number of properties (residential and commercial), which will then be renovated and rented. I do not intend to take out a mortgage, and will be buying for cash.
CGT is not a current concern as I do not intend to liquidate. As I also have no intention of drawing salary or dividends from the ltd, I should pay only 26% tax rather than full whack if I were to own the properties myself.
Profit (rental income) will be used for repairs, and further investment.
Once a sufficient warchest has been built up, I could of course begin repaying the initial loan made to the company.......

Or am I being naïve?

You are ZGUY27 and you didn't like the answers you got in the first thread you opened I guess....
http://forums.contractoruk.com/accou...-property.html

Either that or learn to use the search. This was asked only a few days ago...

[stek]

I am looking at setting up a second LTD, purely as an investment engine, the sole purpose of the LTD will be the purchase of BTL properties. My intention is to make a substantial loan to the company, use those funds to purchase a small number of properties (residential and commercial), which will then be renovated and rented. I do not intend to take out a mortgage, and will be buying for cash.
CGT is not a current concern as I do not intend to liquidate. As I also have no intention of drawing salary or dividends from the ltd, I should pay only 26% tax rather than full whack if I were to own the properties myself.
Profit (rental income) will be used for repairs, and further investment.
Once a sufficient warchest has been built up, I could of course begin repaying the initial loan made to the company.......

Or am I being naïve?

I knew a guy who did that. Dead at 37, ex-wife got the lot.

[KEH]

You are ZGUY27 and you didn't like the answers you got in the first thread you opened I guess....
http://forums.contractoruk.com/accou...-property.html

Either that or learn to use the search. This was asked only a few days ago...

Thanks for the advice, but:
Nope, not ZGUY27
Not looking to take money out of an LTD to fund personal purchase, I'm looking to set up LTD to manage income from rental pool.
Funnily enough, said search function was how I found this thread, and subsequently posted.

I do not intend to sell these properties, and at 18, my children will become directors of the company and will be provided with an income, all things being equal, I have no intention of withdrawing money from this company myself. For the next 9 years, tax should therefore be 26% not 40%. Comment re repaying loan from me, was a worst case scenario.

[Jessica@WhiteFieldTax]

I do not intend to sell these properties, and at 18, my children will become directors of the company and will be provided with an income, all things being equal, I have no intention of withdrawing money from this company myself. For the next 9 years, tax should therefore be 26% not 40%. Comment re repaying loan from me, was a worst case scenario.

Please, go and see an accountant and get some tailored advice. A free forum isn't for advice on long term and financially critical plans like this.

I have a client who is in your position +10 years. Portfolio of rental properties in H&W limited company, would like to transfer to children, but the tax implications get him every which way.

Anyway, for starters, not sure where 26% comes from, and investigate the potentially not inconsiderable tax liabilities around the children becoming shareholders (or otherwise taking an inome) at 18.

[Sockpuppet]

I knew a guy who did that. Dead at 37, ex-wife got the lot.

In the drawing room with the candle stick?

[KEH]

Please, go and see an accountant and get some tailored advice. A free forum isn't for advice on long term and financially critical plans like this.

I have a client who is in your position +10 years. Portfolio of rental properties in H&W limited company, would like to transfer to children, but the tax implications get him every which way.

Anyway, for starters, not sure where 26% comes from, and investigate the potentially not inconsiderable tax liabilities around the children becoming shareholders (or otherwise taking an inome) at 18.

Many thanks Jessica, I have a meeting scheduled in 2 weeks with my tax accountant and my IFA, I came on here spit-balling, on the off chance someone else had been in a similar situation, and could advise, so I don't just end being the pretty little thing in the corner, and can actually add value to the argument between them! Otherwise I'll just make the drinks!

I know it's a fair way off, but I do want my kids to go to University, and intend they work for one of my companies during that time, earning an income.......while classified as students, and taxed as such! Again, I'll be talking this over with my tax guy....nearer the time, who knows maybe some sporting prowess just skipped a generation or two, and they'll be keeping me in my old age!

[Sockpuppet]

I know it's a fair way off, but I do want my kids to go to University, and intend they work for one of my companies during that time, earning an income.......while classified as students, and taxed as such!

Students are taxed the same as normal people...