Buy-to-let through a limited company.
Since Section 24, higher-rate landlords can be taxed on rent they never keep. Holding property in a company or SPV can change that — here’s how the lending works.
The Section 24 problem
Section 24 restricted the tax relief landlords can claim on mortgage interest to a basic-rate credit. For higher-rate taxpayers, that can mean paying tax on rental income that has effectively already gone on mortgage interest — eroding or wiping out the profit.
Holding property through a limited company sidesteps this: the company pays corporation tax on its profit and treats mortgage interest as a deductible business expense. For landlords building a portfolio, the difference compounds year after year.
How SPV lending is assessed
- The SPV. Lenders prefer a clean Special Purpose Vehicle — a company whose only activity is holding property, usually flagged by the right SIC codes.
- Rental stress test. The same ICR logic as personal BTL applies, though company cases are often stress-tested more favourably.
- Director guarantees. Lenders typically take personal guarantees from the directors, so your own position still matters.
- Deposit. Usually 20–25% as a minimum, similar to personal buy-to-let.
- Company ownership can shelter rent from Section 24 interest restrictions.
- Lenders want a clean SPV set up for property only.
- Personal guarantees mean your circumstances still count.
- Always take tax advice — the right structure depends on your whole picture.
Contractors who run a company already understand this world, and often deploy retained profit into property. We handle the mortgage; your accountant confirms the tax. Speak to an adviser to map it out.
This page is general information, not tax advice. Most buy-to-let mortgages are not regulated by the FCA. The tax treatment of property depends on individual circumstances and may change.
Limited company BTL lenders — a selection
SPV buy-to-let, answered
What is an SPV for buy-to-let?+
A Special Purpose Vehicle is a limited company set up solely to hold property. Lenders prefer a clean SPV — often identified by specific SIC codes for property letting — because its only activity is the rental business, which simplifies their assessment.
Why hold buy-to-let in a limited company?+
Since Section 24 restricted personal mortgage interest relief to a basic-rate tax credit, higher-rate landlords can pay tax on rent they never keep. A company pays corporation tax on profit and can deduct mortgage interest as a business cost, which is often more efficient for a portfolio.
Are SPV mortgage rates higher?+
Historically slightly, but the gap has narrowed as company lending has become mainstream. The tax efficiency often outweighs a small rate difference for higher-rate taxpayers — though personal circumstances and accountant advice decide it.
Can I move existing properties into a company?+
Possibly, but it’s a sale and purchase in law — potentially triggering stamp duty and capital gains tax. It needs careful tax advice before proceeding. We work alongside your accountant on the mortgage side.