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Renting Business Premises to rent to my partner!

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    Renting Business Premises to rent to my partner!

    Just wanted to run this idea past a few of you guys to see if you think its a good plan or will get me banged up!

    My partner has just graduated as an Osteopath and is looking to rent premises to practice from.
    My idea was to use cash from my Ltd company (gained through contracts outside of IR35) to rent a property in my company name, and then sublet to my partner's business as well as other similar businesses.

    Initially with just rent from my partner's business, the rental paid by my Ltd Company would be more than the rent received, thus showing a loss and reducing my Corp Tax.
    With time as I filled the extra space in the building the rental income would increase to the point where it would be more than my rental outlay, thus turning a profit for my Ltd company, and would act as a nice nice buffer for when i was between contracts

    Is this dodgy? is there a better way of doing it??

    #2
    Originally posted by Joeman View Post
    Just wanted to run this idea past a few of you guys to see if you think its a good plan or will get me banged up!

    My partner has just graduated as an Osteopath and is looking to rent premises to practice from.
    My idea was to use cash from my Ltd company (gained through contracts outside of IR35) to rent a property in my company name, and then sublet to my partner's business as well as other similar businesses.

    Initially with just rent from my partner's business, the rental paid by my Ltd Company would be more than the rent received, thus showing a loss and reducing my Corp Tax.
    With time as I filled the extra space in the building the rental income would increase to the point where it would be more than my rental outlay, thus turning a profit for my Ltd company, and would act as a nice nice buffer for when i was between contracts

    Is this dodgy? is there a better way of doing it??
    Most lease's will specifically disallow sub-letting and it would make more sense surely to lend her the money personally and it would be deducted from her profit when some appears or form an LLP, lend it the money and withdraw from profit with no tax charge.

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