Buy to Let via new Limited Company

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    Buy to Let via new Limited Company

    I have recently inherited £60k and plan to invest it for my pension and kids future inheritance

    I’m hoping to purchase 2 to 3 houses up north via buy to let setup to rent out and believe doing so via a limited company setup is best in order to avoid the recent tax rule changes?

    This is a long term investment with no plan to sell, I’m currently 40 so will be looking to use the rental income when I reach retirement age

    Just checking I’m going down the right route and will I have trouble obtaining a mortgage being a new company + inexperienced landlord? Ideally looking to purchase a £60k house using a 25% £15k deposit / £45k mortgage, renting out at approx £350-£425 per month

    Plan of action for this year:
    Setup property limited company, open business bank a/c and deposit funds
    Research properties areas / rent returns
    Contact bank or mortgage broker to confirm eligibility
    View properties / make offer and once accepted start mortgage process to purchase

    Does this appear to be a viable setup and is there anything I should look into further?


    You are indeed on the right lines.
    The price tag attached to your target properties may prove a challenge , whilst £50k was the absolute minimum prior to the Coronavirus , this has been increased to £75k with some leading lenders but this would be quickly identified by your broker when you are ready to source your first property given the constant changes within the BTL funding sector.
    I am assuming that you are a homeowner with or without a residential mortgage , I ask this as many lenders have it as a standard eligibility requirement.
    Whilst the tax treatments are less onerous for Limited Company acquisitions the one inescapable penal Charge is the SDLT for properties over and above £40K and don’t forget that you will be required to provide a full Personal Guarantee on any Limited Company borrowings.
    Apart from the above you are on the right lines to proceed in your investment strategy


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