Should You Own Property Through a Limited Company? The Pros and Cons
Since Section 24 reduced mortgage interest relief, many landlords are asking whether holding properties in a limited company makes sense. It can offer tax and growth benefits, but isn’t right for everyone. Here’s a balanced look at the pros, cons, and key factors to consider.
Why More Landlords Are Asking This Question
Since Section 24 reduced mortgage interest relief, many landlords have thought about holding properties in a limited company. It can make sense for some, but not all.
Here’s a balanced look at the pros and cons.
The Pros
- Mortgage interest is fully deductible.
- Corporation tax rates can be lower than higher-rate income tax.
- Easier to reinvest profits for portfolio growth.
- Potential benefits for estate planning.
The Cons
- Limited company mortgages can be more expensive.
- Accountancy and compliance costs are higher.
- Selling can mean double taxation (corporation tax + personal tax on dividends).
- Transferring existing properties may trigger stamp duty and capital gains.
We’ve found this structure usually works best for landlords with multiple properties and long-term growth plans, rather than single-property landlords.
Factors to Consider
- Portfolio size.
- Your personal tax bracket.
- Whether you plan to grow, hold, or sell.
This is where speaking to a tax professional with property experience really pays off.
Final Thoughts
Owning property through a limited company can be smart, but it isn’t always the best route. It depends on your portfolio, your tax position, and your long-term plans.
We’ve seen landlords benefit greatly when they make the decision based on strategy rather than reaction. Getting the structure right at the start saves a lot of headaches later.