Buy to Let Limited company criteria

Buy to Let Limited company criteria

9:55 AM, 12th October 2021, About 3 years ago

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When setting up a Special Purpose Vehicle (SPV) for your Buy to Lets it is important to use the appropriate SIC Code. (A SIC code is a five-digit Standard Industrial Classification code. There are more than 600 individual SIC codes in the UK)

The following codes are normally accepted by lenders: 68100, 68201, 68202, 68209, 68310, 68320.

Whilst there are some companies that will accept trading companies, a lot won’t.

If existing landlords are considering transferring their properties into a limited company structure, it is highly recommended that they take professional tax advice from the team at Property118. Please see >>

The transfer is likely to incur stamp duty and capital gains tax liabilities if you do not seek advice to see if your business qualifies for section 162 incorporation relief. These costs can make it an unviable proposition if you do not do this research.

Advantages for Limited company portfolios

  • Interest payments are considered as a legitimate expense and can be offset against rental income, which reduces tax liabilities
  • Dividends and repayment of directors’ loans makes withdrawing profits more tax efficient
  • Profits are charged at the corporation tax rate rather than at your personal rate of tax
  • Profits can be used to expand the portfolio without any additional tax


  • Additional costs in preparing and filing accounts
  • Interest rates might be higher with some lenders, but not for all lenders

We will be happy to advise you as to the best mortgages available for properties held in individual names, partnerships, SPVs or existing ltd companies.

Contact Malcolm Jones

Commercial Finance, Development Funding and Bridging Finance

  • How can I help you?

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