Contracting - go for higher rate or repeated business?

[b0redom]

I wouldn't get entrepreneurs relief anyway, as I'm investing heavily in funds, and soon in properties too. As long as I won't be benched for a year, contracting will still be better than permieland.

However, time will tell. In the meantime, all I can do is have an eye on oportunities.

Have you actually done any research on this? If you invest in properties through your Ltd, the mortgage rates will likely be much higher than for a non-commercial B2L mortgage, will likely require a higher deposit, AND you'll have to charge your tenants VAT which immediately makes their rent 20% higher.

[stek]

Have you actually done any research on this? If you invest in properties through your Ltd, the mortgage rates will likely be much higher than for a non-commercial B2L mortgage, will likely require a higher deposit, AND you'll have to charge your tenants VAT which immediately makes their rent 20% higher.

Course he hasn't lol!!

[diseasex]

Have you actually done any research on this? If you invest in properties through your Ltd, the mortgage rates will likely be much higher than for a non-commercial B2L mortgage, will likely require a higher deposit, AND you'll have to charge your tenants VAT which immediately makes their rent 20% higher.

Not true. Rental income is exempt from vat as of today.
I also know lenders are preparing offers for companies that want to do BTL because of new leglislation
BTL is slow , I'm more into trading properties, and will want to do at least one transaction with aim to resell to see how it goes. I've been trading different things in my life, got 40k turnover on ebay this year only, while contracting at the same time, and really I don't see properties being that different, it's just entry capital is(was) hard to get. Before you flame me, I know what i'm doing and where i'm going, and if I'm wrong somewhere, I'll learn that soon enough, not the hard way. So if you like , carry on tulip talk like "you will fail, you know nothing", I don't care

[MrMarkyMark]

Have you actually done any research on this? If you invest in properties through your Ltd, the mortgage rates will likely be much higher than for a non-commercial B2L mortgage, will likely require a higher deposit, AND you'll have to charge your tenants VAT which immediately makes their rent 20% higher.

You are letting fact get in the way of fantasy

[MrMarkyMark]

I've been trading different things in my life, got 40k turnover on ebay this year only, while contracting at the same time, and really I don't see properties being that different, it's just entry capital is(was) hard to get.

What about capital gains when you sell?

[diseasex]

What about capital gains when you sell?

You pay CT when you sell minus indexation if traded via LTD

https://www.gov.uk/tax-sell-property/businesses
f the purpose of your business is to buy and sell property (eg you’re a property developer) you don’t pay Capital Gains Tax when you sell a property. Instead, you pay:

Income Tax - if you’re a sole trader or partner
Corporation Tax - if you’re a limited company

[MrMarkyMark]

If the purpose of your business is to buy and sell property (eg you’re a property developer) you don’t pay Capital Gains Tax when you sell a property. Instead, you pay:

Ok, so I guess this bit may affect your IT LTD company business, then

Corporation Tax - if you’re a limited company

[WTFH]

I've been trading different things in my life, got 40k turnover on ebay this year only,

Good for you.


I have a neighbour who does a lot of buying and selling on eBay too. Her turnover is probably up near that level. Her profit levels are low to negative.
She was doing work on her house last year and told everyone about the bargain she got for 6 velux windows at £800 each (instead of £1000 from the builder's merchant). In the end she only had room for 3 (she had ditched her architect and was doing plans herself). She sold the remaining 3 on eBay for £500 each.

[diseasex]

Ok, so I guess this bit may affect your IT LTD company business, then

Yes It would affect entrepreneur relief, however I will probably separate trading business to second LTD before reaching 20% of profit on my consultancy LTD from investments. So no worries for now, as having second LTD would incur more accountant costs

I have a neighbour who does a lot of buying and selling on eBay too. Her turnover is probably up near that level. Her profit levels are low to negative.
She was doing work on her house last year and told everyone about the bargain she got for 6 velux windows at £800 each (instead of £1000 from the builder's merchant). In the end she only had room for 3 (she had ditched her architect and was doing plans herself). She sold the remaining 3 on eBay for £500 each.

eBay is hard, but it works for me. My profit margin is about 20% and i have yet to loose on a single trade. Doing that less recently though - too much hassle for too little. Properties on the other hand would be far more fun. A single asset that brings say 10-20k, unlike selling 400 items for 100 each yielding less.

[MrMarkyMark]

Yes It would affect entrepreneur relief, however I will probably separate trading business to second LTD before reaching 20% of profit on my consultancy LTD from investments. So no worries for now, as having second LTD would incur more accountant costs

Hmmm, good luck with moving all you properties and investments, once they are in a different company name.

As I said, many, many, posts before :- you have not thought all this through.
I admit, not my area, so I don't know all the ins and outs, however, the comment, above, still stands.

In addition, there are many professional accountants, who have posted on here, that have suggested this is not a valid strategy, for that reason, I'm out.