Limited Company Buy-to-Let Mortgages
Limited Company Buy-to-Let Mortgages | Thinking of expanding your property portfolio through a limited company? You’re not alone. More UK landlords are choosing limited company buy-to-let mortgages to maximise tax efficiency and long-term returns. At Connect Mortgages, we specialise in helping landlords secure limited company buy-to-let finance, whether you're purchasing your first SPV or refinancing a full portfolio. With access to 2000+ lenders and providers, including exclusive products not available on the high street, we’ll match you with competitive rates tailored to your strategy.
What is Limited Company Buy-to-Let Mortgages?
Limited company buy-to-let mortgages allow landlords to purchase investment properties through a company structure, typically a Special Purpose Vehicle (SPV), rather than in their personal name. This approach is increasingly popular among portfolio landlords seeking greater tax efficiency, asset separation, and long-term growth flexibility.
By owning buy-to-let property through an SPV, landlords may benefit from reduced personal tax liabilities and retain full mortgage interest relief through the corporation tax regime. These specialist mortgages are designed to support landlords who manage multiple properties and want to structure their investments more strategically.
Lenders assess various factors when approving limited company mortgage applications, including company accounts, projected rental income, and the financial status of directors and shareholders. Most products offer flexible features, such as interest-only payments, longer fixed-rate terms, and options tailored to complex portfolios. However, landlords should also be aware of the setup costs, legal structuring, and compliance requirements involved.
To explore whether this structure is right for you, visit our Buy-to-Let Portfolio Mortgages page or try our Buy-to-Let Calculator for quick affordability checks.
Key Benefits of Limited Company Buy-to-Let Mortgages
Choosing a limited company structure for your buy-to-let investments offers strategic advantages in tax efficiency, portfolio scaling, and long-term financial planning. Whether you’re an experienced landlord or exploring your first SPV mortgage, structuring your property business through a company can unlock major benefits.
Tax Efficiency for Landlords
Many professional landlords are shifting to limited company buy-to-let mortgages to optimise tax outcomes and retain more profit.
- Full Mortgage Interest Deduction: Limited companies can deduct the full amount of mortgage interest from rental income before calculating Corporation Tax. In contrast, individual landlords are limited to a basic rate 20% tax credit on interest.
- Lower Tax Rates on Rental Income: Profits within a limited company are taxed at the Corporation Tax rate, currently 19 per cent on profits up to £50,000 and 25 per cent on profits above £ 50,000. This is generally more favourable than personal income tax, which can reach 40 or 45 per cent for higher earners.
- Retain and Reinvest Profits: You can leave profits in the company and reinvest in additional properties without triggering personal tax liabilities. This makes limited company structures ideal for portfolio expansion.
- Flexible Income Planning: Company directors can strategically access income through salary, dividends, or pension contributions. This provides greater control over when and how profits are realised, supporting efficient landlord tax planning.
- Legal and Financial Protections: Using a limited company provides a separate legal framework that safeguards personal assets and simplifies business operations.
- Limited Liability Protection: The company is legally distinct from its directors, meaning your personal assets are usually protected if the business faces financial challenges.
Mortgage Advice..
Thinking of getting a mortgage? Our experienced team of skilled mortgage advisers are here to offer the essential guidance you require. Relying on our comprehensive understanding of the mortgage market, we’ll ensure you secure the perfect mortgage to suit your specific situation.
Specialist Buy-to-Let Finance Through a Limited Company
Limited company buy-to-let mortgages fall under the specialist property finance umbrella. They are primarily offered by dedicated buy-to-let lenders that understand the unique requirements of corporate property ownership.
In most scenarios, these mortgages are secured by a UK-registered Special Purpose Vehicle (SPV) limited company, typically with UK-based directors and shareholders. If you’re unsure about how to set up an SPV, our limited company mortgage guide can help you get started.
For landlords operating through offshore or limited companies with non-UK-resident directors or shareholders, some specialist lenders may still consider applications, depending on their lending policies.
While many providers cap the number of directors or shareholders at four, a growing number of portfolio mortgage lenders no longer impose strict limits, offering greater flexibility for larger investment teams or family-run property groups. If you’re managing multiple assets, our buy-to-let portfolio mortgages section covers all the key considerations.
Access Specialist Buy-to-Let Finance Through a Limited Company
Many landlords who already hold property portfolios in their personal name are exploring the benefits of purchasing additional properties through a limited company structure. This approach is increasingly popular due to its potential tax advantages and increased lender flexibility.
Buying property through a Special Purpose Vehicle (SPV) can be straightforward when properly structured. At Connect Mortgages, we support landlords at every step, from company formation to securing the most suitable limited company buy-to-let mortgage.
One key advantage of using a limited company is access to specialist mortgage finance that’s often unavailable for personal name purchases. This includes products designed for portfolio landlords, HMO mortgages, and larger-scale investment strategies.
Additionally, by transferring properties into a company, landlords may benefit from improved tax efficiency and interest relief on mortgage payments. However, it’s important to weigh the implications carefully, including stamp duty, legal fees, and capital gains tax. Our team provides expert guidance to help you make informed decisions that align with your investment goals.
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Transferring Property to a Limited Company: Key Tax and Mortgage Implications
If you’re considering moving a personally owned buy-to-let property into a limited company, it’s important to understand the financial, legal, and tax consequences of this decision. This process is not a simple transfer; it is treated as a sale at market value, which can trigger multiple liabilities and require expert planning.
Is Transferring to a Limited Company Worth It?
Transferring property to a limited company for buy-to-let purposes offers potential benefits such as:
- Lower corporation tax rates on rental income
- Full mortgage interest relief (unavailable to individuals due to Section 24 restrictions)
- Greater flexibility for portfolio landlords building a scalable property business
However, these advantages must be carefully weighed against the immediate tax costs, lender requirements, and legal obligations involved.
Key Considerations When Incorporating Property
- Property Valuation and Sale Process: Your limited company effectively purchases the property from you at its current market value. This requires a formal conveyancing process, including a signed sale agreement and, if applicable, new mortgage arrangements.
- Capital Gains Tax (CGT): You may be liable for Capital Gains Tax on any profit since the original purchase of the property. If you qualify as running a genuine property rental business, not merely holding an investment, you might be eligible for Incorporation Relief (S162). This relief allows you to defer CGT, but only under strict conditions such as active day-to-day property management.
Explore more about limited company buy-to-let tax benefits and how incorporation affects your overall liability.
Stamp Duty Land Tax (SDLT)
Your company must pay Stamp Duty Land Tax based on the full market value of the property at the point of transfer. This usually includes the 3% surcharge on additional dwellings, even if you’re the company’s sole director and shareholder.
For complex portfolios, our team can guide you through portfolio buy-to-let mortgage planning, including SDLT implications.
Mortgage Restructuring
Any existing mortgage cannot be transferred to the company. In most cases, you’ll need to apply for a new commercial or limited company buy-to-let mortgage, which often has higher interest rates and may involve:
- Early repayment fees on the original loan
- New lender underwriting
- Stricter affordability criteria based on rental income
Our specialists can assist you with limited company mortgage refinancing and recommend lenders suited to SPV structures.
Legal and Administrative Costs
Expect to pay legal fees for both the property sale and the formation of the limited company (if not already in place). This includes:
- Conveyancing solicitor fees
- Company formation charges
- Accounting costs for tax advice and filings
FAQs: Limited Company Mortgages
Most frequent questions and answers about limited company mortgages
Yes, landlords can take advantage of tax benefits by transferring personal property into a limited company structure. However, it is essential to seek specialist advice from an accountant or tax advisor to ensure you make the most of your investments.
Yes, limited companies can get mortgages. Many banks and building societies offer tailored solutions for businesses and landlords looking to utilise a limited company structure as part of their property portfolio.
The amount of deposit required will depend on the lender and the type of property being purchased. When it comes to limited company buy-to-let mortgages, lenders commonly ask for a higher deposit than they do with standard residential mortgages, usually, at least 20-25% equity or deposit (sometimes even more). As a result, savvy investors who have lower loan-to-value ratios will possess more choices.
Yes, getting a mortgage as a limited company director with credit blips is possible. Lenders will require proof of income, and the best rate are for those with the best credit ratings. However, some competitive lenders will consider directors with credit blips, such as missed payments or CCJs. The more historic the credit blips are, the more competitive the rate can be. Discussing your circumstances with a specialist mortgage advisor before applying can help narrow down the best options.
Limited company buy-to-let mortgages are classed as specialist buy-to-let mortgages and, therefore will have slightly higher rates than high street buy-to-let lenders. Specialist lenders used to charge higher interest rates and fees for limited company buy-to-let compared to other specialist buy-to-let products, but in the main, the rates and fees for limited company buy-to-let mortgages are now very similar to standard buy-to-let rates. Comparing mortgages from different lenders is essential to ensure you get the best possible deal. An experienced mortgage advisor can provide helpful advice on finding suitable finance options.
Connect Mortgages has access to various specialist buy-to-let lenders and are experienced in dealing with limited companies. Our experienced team can help you find the right lender for your needs.
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Liz Syms is the CEO and Founder of Connect Mortgages, a specialist in finance for property investment. With over 25 years of experience in mortgages and financial services, Liz has helped countless people get their dream homes and investment properties. She is passionate about giving her clients the best advice possible when it comes to financial decisions relating to mortgages and protection and is dedicated to providing the highest quality of service. With her wealth of knowledge in the industry, Liz is a respected leader in mortgages and financial services and has grown her team to over 300 advisers nationally. She strives to make Connect Mortgages one of the most successful companies in its field.
About the Author
Liz Syms is the CEO and Founder of Connect Mortgages, a specialist in finance for property investment. With over 25 years of experience in mortgages and financial services, Liz has helped countless people get their dream homes and investment properties. She is passionate about giving her clients the best advice possible when it comes to financial decisions relating to mortgages and protection and is dedicated to providing the highest quality of service. With her wealth of knowledge in the industry, Liz is a respected leader in mortgages and financial services and has grown her team to over 300 advisers nationally. She strives to make Connect Mortgages one of the most successful companies in its field.