BTL portfolio under a Ltd Company

[DimPrawn]

They would be mortgaged. OK, so higher borrowing costs. Makes sense. Assuming we do find rates we find reasonable, any other pitfals? The way I see it happen, is that we wouldn't extract much until we are ready to retire in 20 or 30 years. I'm assuming we won't pay a lot of corporation tax first while we leverage up , because the interest expenses matching or exceeding revenue. In contrast as a private landlord we won't be able to deduct interest expenses fully as before. We wouldn't be hit by stamp duty rises that only apply to personal BTL investors.

No capital gains allowance to reduce tax if you sell them off bit by bit over time.

Someone here will know all the pros/cons I'm sure.

[ChimpMaster]

Not worth doing yet because no one knows what hammer-blow the Tories are going to deliver next.

The changes to SDLT apply at the point of purchase and hence to transactions within a company as well as those carried out in your personal name. There is a 'consultation' due to the end of the year that might exclude larger portfolios (15+ properties) in companies from the 3% SDLT surcharge.

Transferring your portfolio to a Ltd Co would also incur SDLT at current rates and CGT if any is due, costs that you need to factor in over the long term. You are unlikely to benefit from Incorporation Relief because your portfolio needs to be significant and your main 'business'.

[Ned]

Are you BTL properties mortgaged or owned outright?

I believe the sticking point is the availability and mortgage rates open to companies vs individuals. i.e less choice, much higher borrowing costs.

They would be mortgaged. OK, so higher borrowing costs. Makes sense. Assuming we do find rates we find reasonable, any other pitfals? The way I see it happen, is that we wouldn't extract much until we are ready to retire in 20 or 30 years. I'm assuming we won't pay a lot of corporation tax first while we leverage up , because the interest expenses matching or exceeding revenue. In contrast as a private landlord we won't be able to deduct interest expenses fully as before. We wouldn't be hit by stamp duty rises that only apply to personal BTL investors.

[MarillionFan]

Buy to Let: Ltd Company v Personal Investment

[DimPrawn]

My wife and I, have started a modest BTL investment portfolio which we want to keep building up over the next 20 years.

Considering the onslaught on private BTL investors in the past few budgets and reviews. Would it be worth to start thinking about moving portfolio into a Ltd company? I've never looked into it properly as I was quickly told it wasn't worth it. I just wondered if it is still the case with the latest changes. I'm obviously going to get professional advice (any recommendation welcome), but it would be interesting to see if anyone has looked into it recently.

Are you BTL properties mortgaged or owned outright?

I believe the sticking point is the availability and mortgage rates open to companies vs individuals. i.e less choice, much higher borrowing costs.

[Ned]

My wife and I, have started a modest BTL investment portfolio which we want to keep building up over the next 20 years.

Considering the onslaught on private BTL investors in the past few budgets and reviews. Would it be worth to start thinking about moving portfolio into a Ltd company? I've never looked into it properly as I was quickly told it wasn't worth it. I just wondered if it is still the case with the latest changes. I'm obviously going to get professional advice (any recommendation welcome), but it would be interesting to see if anyone has looked into it recently.