Given the problem of the extraction of profits from a limited company, it makes sense to keep sufficient BTL or HMO or SA properties in your own name, so long as the nett profits are not enough to take the taxpayer above the basic rate band. Beyond that, then buying them via a limited company makes sense. If the landlord has some other paid employment or self-employment, it might be necessary to make maximum possible pension contributions to eliminate this partly or wholly from the total income, to stay within the basic rate band. How many properties will depend on how profitable each is, which depends on its size and local market conditions for renting.
@martinmiller6568
Жыл бұрын
Spot on analysis
@numerouno2532
8 ай бұрын
I agree but the only problem with the pension contributions is you're limited on what you can invest in inside a pension such as a sipp and you have to wait until you're 55 (currently) to access it
@johnporcella2375
8 ай бұрын
@@numerouno2532 At £60,000 pa gross, that is a significant chunk of change that can be used. Now there is no lifetime allowance limit.
@johnporcella2375
3 ай бұрын
@@numerouno2532Once the portfolio is bug enough, new property investments perhaps should be in a limited company. At this point, careful consideration should be made as to whether to have a SSAS pension, which is typically more flexible than a SIPP.. A SSAS can invest in commercial property and you can get at at least half the money in the fund, regardless of age.
@johnporcella2375
3 ай бұрын
Whilst the Corporation Tax rate may be less, perhaps, if the company owner wants to extract that profit, then s/he will end up paying Dividend Tax if extracted that way and income Tax and NI if by way of a wage.
Пікірлер: 7