LegalinX report: Buy to Let sees surge in purchases by Limited Companies
Mortgages for Business has reported on an increase in landlords purchasing buy to let houses through limited companies in the last quarter of 2016, with figures expected to rise further in 2017. The proportion of purchase application made through a limited company increased by 6% in Quarter 4 2016, from 63% in Quarter 3 to 69%. It is reported that before the changes made to tax relief on mortgage interest by George Osborne in July 2015, these figures were as low as 21%.
Following on from the implementation of changes to the Stamp Duty Land Tax (SDLT) in April 2016 which sees an extra charge added to any additional homes purchased including buy to let, the buy to let market has slowed dramatically. However, with the number of re-mortgage applications made by limited companies also on the increase, Mortgages for Businesses suggests that this shows landlords are transferring their properties to a limited company, reducing the proportion of applications made by individuals.
Commenting on the growth, the Managing Director of Mortgages for Business, David Whittaker said that given the financial incentives available when purchasing a buy to let property as a limited company rather than as a private landlord, it is unsurprising to see an increase in figures. He went on to say that it was “encouraging to see growing numbers of landlords approaching their investments intelligently”. With further changes to tax relief due in April of this year, Whittaker also believes that this trend is likely to continue for a while yet.
With many landlords reaping the benefits of purchasing a buy to let property through a limited company, LegalinX-7Side are pleased to be able to offer both Company Formations and Conveyancing Searches to conveyancers and solicitors. We have a wide range of cost effective Company Formation packages for setting up all types of companies, from basic to more complex company structures. Our Property Search Department also provide all searches required for residential or commercial property transaction nationwide. For further information on these services, please visit our website www.legalinx.co.uk.
This article was submitted to be published by Legalinx-7Side as part of their advertising agreement with Today’s Conveyancer. The views expressed in this article are those of the submitter and not those of Today’s Conveyancer.