Last updated: 14 October 2026
Should you buy a property in your own name or through a company?
It depends on your tax rate, how much profit you’ll keep in the business, and your plans for the money. Individual landlords pay income tax on rental profit at up to 45% and only get a 20% tax credit for mortgage interest. A company pays corporation tax at 19% to 25% and deducts mortgage interest in full, but taking money out as dividends adds personal tax. Companies tend to suit higher rate taxpayers who reinvest profits and use mortgages; owning personally often suits basic rate taxpayers and those who want the income.
Comparison for 2026/27
| Issue | Own name | Limited company |
| Tax on profit | 20%, 40% or 45% (22%, 42%, 47% from April 2027) | 19% to 25% corporation tax |
| Mortgage interest | 20% tax credit only | Fully deductible |
| Extracting profit | No further tax | Dividend tax 10.75% to 39.35% |
| CGT on sale | 18% or 24%, £3,000 exemption | Corporation tax on gain, then tax on extraction |
| SDLT on purchase | Standard rates plus 5% if additional | Standard rates plus 5%, even on first purchase |
| Mortgage rates | Usually lower | Usually higher |
| Admin | Self Assessment | Accounts, CT600, confirmation statement |
Example
Mark, a 40% taxpayer, buys a £250,000 flat with rent of £15,000 and mortgage interest of £8,000. Owning personally: tax on £15,000 at 40% is £6,000, less a £1,600 credit, so £4,400 on £7,000 of real profit. Through a company: profit after interest is £7,000; corporation tax at 19% is £1,330. If he leaves the profit in the company, he saves £3,070 a year. If he takes it all as a dividend, higher rate dividend tax at 35.75% on £5,670 adds £2,027. The company route is then about £1,000 a year cheaper, before accountancy fees and higher mortgage costs, which can use up most of that.
Moving existing property into a company
Transferring a property you already own to a company is a sale at market value. You may pay CGT and the company pays SDLT. Incorporation relief can defer CGT if you run a genuine property business, but SDLT is normally still due unless you’re a partnership.
Inheritance tax
Shares in a property investment company don’t qualify for Business Property Relief. Companies can help with IHT planning through family share structures, but this needs careful advice.
Holding let property through a company to pay less
Many landlords ask whether a company would reduce their total tax. It often does for higher rate taxpayers reinvesting profit, but the extra costs and dividend tax can wipe out the saving for others. Run the numbers on your own figures.
Common mistakes
- Comparing only tax rates and ignoring extraction
- Transferring existing properties without considering CGT and SDLT
- Using a company for one small property
- Forgetting higher mortgage rates
Frequently asked questions
Can a company get a buy-to-let mortgage?
Yes, specialist lenders offer them.
Is ATED due?
It applies to company-owned homes worth over £500,000, but property let commercially to unconnected tenants qualifies for relief. A relief return is still needed.
Can I lend money to my company instead of investing?
Yes, and repayments come out tax-free.
Does a company get the rent-a-room scheme?
No.
Related: the SDLT surcharge, sharing rental income with a partner and whether to incorporate.
Talk to Accotax
Want this handled for you? Our team at Accotax can help with property company or personal ownership. See our landlord accountants service, or contact us for a free, no-obligation quote.
This page is general guidance based on HMRC rules for the 2026/27 tax year, checked against gov.uk on 14 October 2026. It is not personal advice, so speak to an accountant about your own situation.
