Correct/efficient way to act as investor in someone's else's property development business

[spooky]

Hi all, looking for a practical solution...

I have a trading company (LTD) and a linked investment company which draws dividends (in specie) from the trading company for the purposes of investment in property, stocks etc.

My relative wants to start doing property development. They have their own LTD, but it only has enough funds to pay for renovation costs. I'd like to help get them started by effectively buying their first property via my LIC (including stamp duty, legal fees etc). I'd like no further involvement or costs from there on.

Clearly I'd want some kind of return - let's say 10% within a year. But they can keep the rest.

What's the correct or most tax efficient way of setting this up? Can it be done via my LIC, or would it have to lend them the money for them to buy it themselves via their LTD? Or, something else?

Thanks in advance.

[AGoodman]

This is too much for a forum. You need some proper advice - partly to avoid any hazards but also to explore any incorrect assumptions you may have made.

At first sight, if your company is buying the property, it looks less like an investment and more like your company is developing a property and using the other person as a contractor.

You also need to ensure that any generosity on the part of your company(ies) does not amount to a deemed distribution.