Restriction on Tax Relief- possibilities of incorporation as a limited company?

by Readers Question

16:42 PM, 16th January 2017
About 2 years ago

Restriction on Tax Relief- possibilities of incorporation as a limited company?

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Restriction on Tax Relief- possibilities of incorporation as a limited company?

I own a number of BTL flats. Given the changes to tax relief I am considering putting them in to the name of a limited company. possibilities

I have been told that changing the title deeds is straightforward, but I would also have to change the mortgage as well on each flat so that the mortgage is in the name of the limited company as well as the title deeds.

To do this I would need to get the lender to agree to it and I am a bit hesitant to ask them in case they say no. The lenders are Birmingham Midshires and Mortgage Express.

Has anyone done this yet for existing ( rather than newly acquired ) properties and does anyone know what the attitude of these two lenders has been or is likely to be?

Many thanks

David



Comments

Mark Alexander

19:37 PM, 16th January 2017
About 2 years ago

Hi David

The last thing you should be doing is changing the legal title. You would, as you say, require lender consent for this.

Also note that transferring properties to a company would attract Stamp duty and could also result in a substantial capital gains tax bill without proper planning.

The good news is that tax relief and legal structures exist to help with all of these things.

We have prepared a number of easy to read tutorials on these subjects which you can download and read at your leisure completely free of charge.

Please see https://www.property118.com/free-landlord-tax-tutorials/

The tutorials I recommend you to read first are:-

"Understanding incorporation and the various costs, benefits and tax relief available"

and

"Beneficial Interest Company Trust - how to avoid the need to refinance when incorporating"
.


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