Limited company cost

Whilst this is a large fee increase in percentage terms, no property investor is going to be put off by an additional cost of £38 to register a limited company or SPV. After all, many pay more than this by setting their limited company up through their accountant, rather than doing this themselves. Investors will seek tax advice and weigh up the pros and cons of limited company buy to let against those in the personal name and the small fee to register a company will likely not be a pivitol factor in that decision.

I don't think this cost will deter people as, in the grand scheme of things, the cost is minimal and it has been low for a substantial period of time. I do arrange a lot of mortgages for Limited Company buy to lets as the regulatory and taxation changes have forced most down this path. It is important to say that this isn't the right route for everyone and the appropriate advice should be sought before committing as it is an expensive mistake to rectify further down the line.

The recent rise in the cost of setting up a limited company—a sharp 316% increase to £50—might seem steep, but it's unlikely to deter investors from opting for a limited company structure for buy-to-let investments. This upfront cost is relatively minor in the context of overall investment expenses and potential tax benefits. It’s essential for investors to consult with a property tax specialist to crunch the numbers and ensure that the structure aligns with their financial goals. Recently, there has indeed been a noticeable uptick in buy-to-let applications through limited companies, suggesting that many see the benefits outweighing the initial costs. Investors should remain vigilant about ongoing obligations and tax implications of this setup to ensure they can make the most informed decisions.

It is unlikely that a £38 increase in one fee is going to cause any landlord a financial problem, as the benefits of a Limited Company buy to let will more than outway that increase. They are popular with landlords due to the preferential tax treatment, as well as the easy inheritance planning that can be achieved, but as always the appropriateness of using such a scheme should be discussed with a tax accountant first, as it is not always the right way forward. These schemes do attract higher rates and fees, and will have other company related costs, so the benefits and the extra costs need careful consideration.

It will make no difference at all for seasoned investors who look to purchase properties into a limited company; what it may well do is prevent the cut-and-run operations in other industries, and we are seeing a rise in ltd company buy-to-let enquiries again. This is down to each and every individual's tax position so tax advice is essential.