It’s official – NO NEED to refinance when incorporating into a limited company

by Ranjan Bhattacharya

19:00 PM, 1st February 2021
About 3 months ago

It’s official – NO NEED to refinance when incorporating into a limited company

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It’s official – NO NEED to refinance when incorporating into a limited company

HMRC CONFIRMS you do not have to refinance all your properties when you incorporate your portfolio into a Limited Company.

In this video below, Mark Alexander from Property 118 & I, Ranjan Bhattacharya, break down exactly what this means for property investors!

HMRC Capital Gains Manual CG65745:

https://www.gov.uk/hmrc-internal-manuals/capital-gains-manual/cg65745

 

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Comments

John Hynd

6:21 AM, 4th February 2021
About 2 months ago

Reply to the comment left by Gary Nock at 03/02/2021 - 09:36
But he would not answer the simple question as to whether SDLT would be payable on transfer and was saying it would cost £400 to find out. That's my point.

Mark Alexander

6:27 AM, 4th February 2021
About 2 months ago

Reply to the comment left by John Hynd at 04/02/2021 - 06:21
Maybe, maybe not. It depends of circumstances.

Imagine calling an insurance broker for a quote for a car, but not telling him the make, model, reg, age, value mileage or anything about the driver, previous claims, age, previous motoring convictions. That’s just for a free insurance quote. Tax planning is far more complex!

Gary Nock

6:33 AM, 4th February 2021
About 2 months ago

Mark you took the words right out of my mouth. It all depends on individual circumstances and a straight "yes or no" answer is either not possible without the consultation, or comes with so many caveats that it becomes of less value, and subject to change.

Anthony Johns

9:05 AM, 6th February 2021
About 2 months ago

Re. Your quote: "The legal ownership is not transferred to the Limited Company, so the lenders security is unaffected." Does this imply the 'Land Registry' do not receive notification of the 'transfer' ?

Mark Alexander

9:08 AM, 6th February 2021
About 2 months ago

Reply to the comment left by Anthony Johns at 06/02/2021 - 09:05
There is no transfer required at the point of incorporation. Please see https://www.property118.com/tax/incorporating-property-portfolio-without-refinance/

Navro18@gmail.Com

19:25 PM, 6th February 2021
About 2 months ago

Reply to the comment left by Mark Alexander at 02/02/2021 - 16:43
Hi Mark do lenders need to be told when executing this strategy?

Mark Alexander

22:35 PM, 6th February 2021
About 2 months ago

Reply to the comment left by at 06/02/2021 - 19:25
Unless your mortgage T&C's specifically require you to notify them when you exchange contracts to sell, there is no need to inform that you are doing so. There is nothing to preclude you from doing so either though. Insofar as I am aware, no mortgage T&C's carry such conditions.

Navro18@gmail.Com

23:38 PM, 6th February 2021
About 2 months ago

Reply to the comment left by Mark Alexander at 06/02/2021 - 22:35
Thank you

HardworkingLandlord

14:14 PM, 7th February 2021
About 2 months ago

Is this basically a Beneficial Interest trust which has been around for a while but advisors seem to shun it on the ground that HMRC wont like it but now it seens they do? Also if this was released in Oct, how come we are only talking about it now? Thanks otherwise for advising us of some potential good news when its always bad news for landlords

Mark Alexander

14:53 PM, 7th February 2021
About 2 months ago

Reply to the comment left by HardworkingLandlord at 07/02/2021 - 14:14
Yes, Property118 and Cotswold Barristers were the first to use the Beneficial Interest Company Transfer structure and we were indeed criticised for doing so. It is now considered "normal".

We were slow to announce news of the updated HMRC guides because, for us, the guide states what we knew to be the case all along. It was only as a result of a passing comment to Ranjan Bhattacharya that he picked up on what a big thing this really was, and asked us to record the video now released.

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