Guide to Buying Property Through a Limited Company: Advantages, Disadvantages, and Considerations

The popularity of buying property through a limited company has been on the rise since changes to mortgage interest tax relief rules were introduced in 2017. This investment route offers various advantages and disadvantages, making it a topic of interest for many property investors.

When purchasing property through a limited company, the company becomes the legal owner of the property, rather than an individual. This can offer tax benefits, such as lower tax rates on rental income profits and the ability to retain profits within the company when selling the property.

However, there are also disadvantages to consider, such as increased administrative burden and costs, reduced access to buy to let mortgage deals, and higher buy to let mortgage interest rates. Additionally, transferring a property from personal ownership to a limited company can incur stamp duty costs.

Despite the challenges, investing in property through a limited company can be a lucrative option for higher-rate taxpayers looking to save on their tax bill. It’s important to carefully weigh the pros and cons and seek advice from qualified tax professionals before making a decision.

If you are considering buying property through a limited company, specialist advisors can help you find the right mortgage from a wide range of lenders. They can assist with the process and ensure a smooth and efficient transaction. Contact them during office hours or enquire online for a call-back to get started on your investment journey.