Property rentals through a company

[Maverick]

My uncle has several properties currently paying tax as a self employed person through schedule A.

Q1. If i transfer the properties to ltd co then is stamp duty payable on the transfer

Q2. Does a transfer need to take place to run the rental income and expenses through the Ltd company or can this happen without the transfer of deeds ?.

[N-Tax]

Yes, stamp duty would be payable on the transfer. This will be due within 30 days of completion

I think that the transfer would need to take place in order for the LTD to claim the income and expenses.

[King_Maker]

Briefly :

1. Yes.

2. A Deed of Trust should be effective, AFAIK?

What about CGT?

[Maverick]

Another thought would be opening a Property Management Company to help shield some taxation ( if his sons were made directors ) if he himself was a director then would this fall under IR35 rules ???

[cranleys]

Maverick

Just read your last point which does not appear to be answered. Yes, IR35 could become an issue. Would recommend you actively seek other rental properties to assist in this matter.

Would recommend a Deed of Trust, happy to assist on this by recommending those who do it.

CGT would still be payable though, have you looked at the size or relying upon Management company instead?

We have a number of others using a set up similar to this.


Colin Davison
Property tax accountant and advisor
Cranleys Chartered Accountants.
colin@cranleys.co.uk
+44 1256 830000

[Maverick]

Management Company is the way forward , only issue is Ir35 but as long as there are agreements in place between the company and owner all should be ok and there will be some potential tax saving.

Thanks for your help Colin.

[N-Tax]

In order to be caught by IR35 you need to be found to be an employee of your client.

I don't think IR35 would apply to you because you cannot be an employee of your tenant