Do I Need A Property Investment Company?
Well, that all depends on your circumstances ...
If you only have a few buy-to-let properties the answer is probably no, and if you have lots of properties the answer is probably yes, but as with all things to do with tax, the right answer is that it depends on your circumstances ...
As with all things tax, whether you need a property investment company or not will depend on your individual circumstances and you should always take professional advice.
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Why should you think about a property investment company? Well, they have some interesting advantages and are often an alternative to higher tax bills! So what circumstances will affect you and what issues do you need to think about?
Do you run a limited company business as well as invest in property? If you have your own business structured as a limited company then a property investment company can be a very flexible advantage to add.
Do you have four or more BTL properties and do you manage them yourself? If so creating a property investment company might be just the right thing to do.
Are you a 40% or 45% taxpayer with buy-to-let properties, and have a substantial mortgage on them? The impending changes to mortgage interest relief can be mitigated by using a property investment company. However, firstly, check the costs of using a company versus the benefit to your personal tax situation. Secondly, check the availability of mortgage finance for your limited company.
Are you a 40% or 45% taxpayer and are worried about Inheritance Tax (IHT) for your family and are wondering how you pass assets down the generations? Property investment companies can be used as an alternative to trusts.
I would always recommend you speak to a tax specialist to get specific advice about your individual circumstances.
If you'd like to have a coffee with me so we can discover exactly what it is you need when it comes to your property investment ideas, do give me a call on 0333 335 0422 or click here to send me an email and let's arrange a date and time to meet up.
Until next time ...
I've been an accountant in and for business since 1987 and have a wide experience of consultancy, audit, accounts, taxation and wealth planning work from individuals and small businesses to multinational corporations and charities.
My eclectic interests in growing and developing business span a number of areas … and can be summarised as strategic business advice and tax saving advice.
I have worked with the Chamber of Commerce to deliver courses for people about starting up in business and have lectured about tax for a major accountancy practice and for Milton Keynes College.
I relax by reading fiction and by getting away from the office in a campervan.