I have six or seven properties (in the Midlands). Can I transfer them all together in a company and will that avoid stamp duty land tax (SDLT)? Can the same company deal with the management of the rent so that the rent goes in the same account and there is 19% tax as opposed to 40% on personal income tax?
Arthur Weller replies:
You can transfer six or seven properties together into a company, but there will be SDLT on the transfer, unless partnership relief from SDLT is available to you. If you did transfer your property portfolio into the company so that the company owned the properties, the company would be subject to corporation tax at 19% (currently) on the rental income, as opposed to you paying income tax at 40% (or 45%) on rental income from personally-owned properties. But you must be aware that it will cost you tax to take money out of the company.
This question was first printed in Property Tax Insider in October 2018.