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bigduckontax
bigduckontax, Accountant
Category: Tax
Satisfied Customers: 4349
Experience:  FCCA FCMA CGMA ACIS
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I have started investing in properties.. The first two I

Customer Question

I have started investing in properties.. The first two I have purchased have been in my own name, but I have also set up my own LLP as I thought this might be a better way of keeping things together and make it more transparent if everything goes in and
out of one account. Should I have them and future purchases registered under the company name? Are there any difficulties in obtaining a mortgage/finance if the property is to be registered under the company name?
Submitted: 2 years ago.
Category: Tax
Expert:  bigduckontax replied 2 years ago.
Hello, I am Keith, one of the experts on Just Answer. and pleased to be able to help you with your question. The only problem with operating a property portfolio through a company is that Capital Gains Tax (CGT) is levied at 28% and there is no Annual Exempt Amount (AEA). If operated personally there may be some CGT at 18%, depending on tyour income including gains and there is an AEA of 11.1K available to offset gains. Obtaining a mortgage through a company depends entirely on the mortgage provider who may not be so keen on the transaction and could charge a higher rate of interest or even refuse support at all. On the other hand any interest element is allowable against Corporation Tax as indeed it would be against Income Tax also. I do hope my reply has been of assistance.