Shelter’s Income and expenditure figures highlighted13:57 PM, 4th February 2019
About 2 weeks ago 35
The benefit of becoming a corporate landlord is that it allows you to retain profits at corporation tax rates of 20% and falling, and continue to offset 100% of finance costs against income despite George Osborne’s tax changes for individual landlords being phased in from April 2017. It works best for portfolios where mortgage debt is in excess of £1 million.
For sole traders, optimal costs can be achieved by restructuring in three steps over a period of three years.
Step one – two choices
Submit partnership tax returns for the next three years.
After three years have expired, transfer 100% of beneficial ownership of the partnership to NewCo and claim s162 incorporation relief to mitigate CGT and SDLT relief under FA 2003 section 15 land and buildings. Use a beneficial interest company trust to avoid costs of refinancing.
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