Limited company buy-to-let, explained.
SPVs, SIC codes, personal guarantees, Section 24, and whether moving properties into a company is worth the stamp duty and capital gains tax. The mortgage side, in plain English.
Why so many landlords use a company
Since the "Section 24" changes finished phasing in, individual landlords cannot deduct mortgage interest from rental profit; they get a 20% tax credit instead. A higher-rate taxpayer with a mortgaged property can end up paying tax on profit they have not made. A limited company deducts interest in full and pays corporation tax (19% to 25%) on the actual profit. Money left in the company is taxed once; money taken out as dividends or salary is taxed again. Whether that is better depends on your income, your plans and how long you will hold the properties. An accountant should run the numbers. This page is about the mortgage side.
What lenders want to see
- A special purpose vehicle (SPV). A company whose only business is holding property, with the right SIC codes: 68100 (buying and selling own real estate), 68209 (other letting and operating of own or leased real estate), 68320 (management of real estate), 68201 (renting and operating of Housing Association real estate). Most lenders insist on SPVs; a few will lend to trading companies at higher rates.
- Personal guarantees from the directors, usually all of them, and often independent legal advice for each before signing.
- Directors and shareholders who would qualify personally: the lender underwrites the people behind the company, including credit checks and, usually, minimum income.
- The company's documents: certificate of incorporation, articles, a list of directors and shareholders, company bank statements, and accounts if it has traded.
- Rental cover at 125% rather than 145%, which is the mortgage-side advantage of a company. Rental cover.
Rates and fees
Limited-company rates are typically 0.25% to 0.75% higher than personal buy-to-let rates, and the choice of lenders is smaller, though it has grown a lot. Arrangement fees and legal costs tend to be higher. Whether the tax saving outweighs the higher rate is the accountant's sum, and for higher-rate taxpayers with several mortgaged properties it usually does.
Moving existing properties into a company
This is a sale from you to the company, and it costs money:
- Stamp duty at additional-property rates on the full market value (5-point surcharge in England and NI; ADS in Scotland; higher rates in Wales). On a £250,000 property in England: £15,000.
- Capital gains tax on the gain since you bought it, at 18% or 24%, because it is a disposal at market value.
- A new mortgage in the company's name, with its fees and legal costs, and an early repayment charge on the personal one if you are mid-deal.
For one or two properties bought years ago, the cost usually outweighs the benefit. For a large portfolio run as a genuine business, "incorporation relief" can defer the CGT and, in some circumstances, partnership rules can reduce the stamp duty. This is specialist tax advice territory; do not do it on a forum tip.
Buying the next one through a company
Far simpler: set up the SPV before you offer, buy in the company's name, and the personal properties stay as they are. Mixed portfolios (some personal, some company) are common and lenders are used to them.
Remortgaging a company-owned property
The same process as a personal remortgage with more paperwork: company documents, directors' guarantees, and a lender that accepts SPVs. Product transfers are available from most company-friendly lenders. Start six months out as you would personally. The process.
Tell the broker whether the company already owns property, whether all directors will guarantee, and whether any director's income or credit history is unusual. Those three things decide the lender.
A note on the numbers. Rental cover ratios, stress rates, loan-to-value limits and fees are typical of the market at the time of writing (2026) and differ from lender to lender. Tax rules are for individuals and companies resident in the UK and change with each Budget. This is general information, not advice: a broker will tell you what applies to your property, and an accountant what applies to your tax.
Common questions
Do I need a special company for buy-to-let?
Most lenders want an SPV with property SIC codes, set up for the purpose. A company that also trades (a plumbing business, say) is accepted by fewer lenders and at higher rates.
Are limited company mortgages more expensive?
Typically 0.25% to 0.75% higher in rate, with higher fees. The tax saving often outweighs it for higher-rate taxpayers; an accountant can tell you whether it does for you.
Can I transfer my properties to my company without paying stamp duty?
Generally no. The transfer is a purchase by the company at market value with the additional-property surcharge. Reliefs exist for genuine partnerships and large portfolios; they are narrow and need specialist advice.
Will I be personally liable?
Yes. Lenders take personal guarantees from directors, so the limited liability of the company does not protect you from the mortgage debt.
Your deal is ending. Let's get a broker on it.
Two minutes of questions about the property. We match you with a buy-to-let specialist who calls you back, usually within one working day. Free, no obligation.