Evaluating your limited company options
The number of UK and international landlords choosing to register as a limited company to manage their portfolios is on the rise, research from property investment firm Thirlmere Deacon has revealed.
The firm has reported a spike in international investors enquiring about forming a limited company, up 62% year-on-year. Last year, there were said to be a total of 41,700 buy-to-let incorporations, an increase of 23% on 2019. The numbers have more than doubled since 2016, rising 128%, when tax changes for landlords were introduced.
Between the beginning of 2016 and the end of 2020 more companies were set up to hold buy-to-let properties than in the preceding 50 years combined. Companies set up to hold buy-to-let properties were said to be the second most common company founded during 2020, with companies selling goods online or by mail order in first place. More than a third (34%) of all companies set up to hold buy-to-let properties in 2020 were in London. Together, London and the South East were suggested to have accounted for almost half (47%) of all incorporations.
This growth is substantial, which leads to the question – is the limited company route one that all landlords should be taking?
It depends on a multitude of factors relating to how many properties a landlord owns, their personal financial situation, their property-related aspirations and future pension requirements. Landlords need to fully understand the key considerations when it comes to setting up a limited company and how this could impact them over the short, medium and longer-term.
This remains a complex area. So, if you are a landlord who would like to know more about the pros and cons attached to a limited company option then why not speak to us today on 0800 170 1888 to help you make a more informed decision.