Government BTL tax changes – workaroundsMake Text Bigger
I have always purchased my investment properties through a limited company so am quite lucky I suppose in that I don’t see any impact on my business with the potential government changes (my turn will come I’m sure).
However, I was thinking last week on what would I do if I was in the shoes of you guys out there who have bought property in your own names. I would create a new ltd co that would lease the BTL property from myself at a rate that would be at close to cost (mortgage cost).
The ltd company would be the separate legal entity that would appear on the ASTs and all rents, expenses etc would go through the bank account of the new ltd co.
All costs would be deducted in the normal way against rental income and corporation tax would be paid at the standard rate.
The personal taxation would not change as there is no profit on the lease.
There would be a personal tax liability on the dividend income but the chancellor would take less of a slice this way.
Has anyone done this or maybe it’s been raised on the forum and I’ve missed it?
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