pattricia 575 #1 Posted August 12, 2021 My nephew owns 3 houses , not counting the one he lives in. He rents these off , and is thinking of buying more in the future, but after talking to other landlords he finds that some have formed property companies. He is a newcomer to the renting business so does not know much about property companies. What are the advantages, tax wise etc; of forming a property company. Any advice from landlords or solicitors etc; would be much appreciated so I can pass this advice on to my nephew. Share this post Link to post Share on other sites Share this content via...
Jeffrey Shaw 90 #2 Posted August 12, 2021 Best to start by asking his Accountant. Look particularly at Capital Gains Tax, Inheritance Tax, and SDLT. Also: are the houses mortgaged? If they are, he'd need to consult the mortgagees [lenders] or arrange for the Co to purchase [inc. discharging existing mortgages] and create new mortgages. Share this post Link to post Share on other sites Share this content via...
pattricia 575 #3 Posted August 12, 2021 No mortgages to pay Jeffrey, but I shall pass the rest of your information on to my nephew. Thank you so much ! Share this post Link to post Share on other sites Share this content via...
dan2802 53 #4 Posted August 12, 2021 He needs to talk to his accountant. It really is that simple. Share this post Link to post Share on other sites Share this content via...
pattricia 575 #5 Posted August 12, 2021 2 hours ago, dan2802 said: He needs to talk to his accountant. It really is that simple. Thank you Dan. He will be glad it’s simple. Share this post Link to post Share on other sites Share this content via...
Jeffrey Shaw 90 #6 Posted August 17, 2021 It's not- but certainly such advice should be a first and principal step. Share this post Link to post Share on other sites Share this content via...
topflat29 10 #7 Posted August 26, 2021 Companies pay 19% corporation tax on annual profits . Mortgage Loans is usually at higher interest rate for companies but is fully allowable operating expense against the rental income. Companies required to prepare and file annual accounts to Companies House as well as submit tax return to Tax Office. Accountant charge for preparing accounts. Persons pay 20% and 40% tax on any annual rental income above the personal allowance of £12,500. Liable for capital gains tax after sale of property. Mortgage interest rates are lower than for companies. Loan interest is not an allowable expense against rental income but 20% of interest may be offset against the annual tax. Share this post Link to post Share on other sites Share this content via...
Jeffrey Shaw 90 #8 Posted August 29, 2021 On 26/08/2021 at 19:09, topflat29 said: Companies required to prepare and file annual accounts to Companies House as well as submit tax return to Tax Office. Small companies may apply for exemption from full audit requirements. Share this post Link to post Share on other sites Share this content via...