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Graham Awards


Surge in buy to let company purchases thanks to tax changes

New research shows more than half of landlords plan to use limited companies to buy properties in the year ahead. 

The study found 55 per cent of landlords intending to use limited companies for purchases - that’s over double the 24 per cent of landlords who intend to buy as an individual.

The latest research, by Precise Mortgages, confirms the continuing rapid growth in the number of landlords using limited companies to expand their portfolio.


In the final quarter of 2018 around 44 per cent of landlords said they planned to use limited companies for purchases and in Q1 of 2019 the number was 53 per cent.

Limited companies are most popular among landlords with a portfolio of 11 or more properties, with 71 per cent using them for purchases.

However it’s still the dominant option for those with portfolios of 10 or fewer, with 51 per cent saying they will go down the limited company route to buy their next property compared with only 27 per cent buying as individuals.

Limited company status is more attractive to landlords as the phased reduction in mortgage interest tax relief does not affect them and they can offset mortgage interest against profits which are subject to Corporation Tax of 19 per cent instead of income tax rates. 

Interest coverage ratios on limited company applications are also lower than for most individual landlord applications.

Precise Mortgages managing director Alan Cleary says: Despite the challenges in the market, professional landlords have still managed to grow their portfolios over the past year with the use of limited companies, and it will continue to be the most preferred purchase route particularly for those with larger portfolios.

“The increased use of limited company status is further evidence of how the buy to let market is changing and demonstrates how brokers and their clients need expert specialist support when buying as a limited company or considering switching.”

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    Alan Cleary what do you mean by a 'professional landlord' please? Are you getting the term mixed up with 'incorporated landlords'?


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