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Should property investors use a Ltd company to buy?

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If you are looking to establish a portfolio of investment properties, holding them within a limited company is the best way to reduce your tax bill. If you own buy-to-let properties personally then the rental profits you receive are taxed at your personal tax rate. This could be as high as 45%, depending on other income you may receive.

When you hold properties within a company, rental profits are taxed at 20% if they are less than £300,000 a year. And instead of withdrawing the profits, you can reinvest them into additional properties at a reduced rate. When you come to sell, capital gains will be charged at the corporation tax of 20% rather than 18% or 28% (depending on your taxable income) if you are selling personally.

If you already have an investment property or properties personally, it can be difficult and expensive to transfer them into a company in the form of capital gains and stamp duty, so you may be better off retaining them as personal investments and buying future properties through a company. Though there is currently incorporation relief on offer with deferred payments of capital gains tax. We recommend you speak to your property tax accountant to decide the best route for you.

Here's further documentation from the Government when buying and selling property via company ownership  https://www.gov.uk/tax-sell-property/businesses

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