Transferring Property to a Limited Company 2026

When a landlord buys a buy-to-let in a fresh company, the company simply makes the purchase and there is nothing to move. Transferring a property you already own personally into a limited company is a very different thing. In the eyes of HMRC it is a sale at market value from you to the company, even though you own both sides of the deal. That single fact, that incorporation is a disposal and not a paper reshuffle, is the reason this decision is so much heavier than buying new in a company, and it is why so many more landlords buy fresh through a company than convert what they already hold.

We need to be clear at the very start about what this article is and is not. We arrange the mortgage leg of an incorporation, the company refinance that pays off your personal loans and funds part of the transaction, and we work alongside your accountant on that. We do not give tax advice. Capital gains tax, the stamp duty surcharge, incorporation relief and Section 24 all turn on your personal circumstances, the structure of your property business and legislation that changes from one Budget to the next. Nothing here is tax advice, and you should take advice from a qualified accountant or tax adviser before you act on any of it.

This article walks through limited company and SPV property finance as it applies to incorporation in 2026: what the transfer process really involves, the three tax events to plan for and the relief that can defer one of them, the refinance leg we arrange, the advantages and disadvantages set side by side, and a worked-example feel for the numbers. The finance figures here are indicative market commentary for UK limited company buy-to-let, not quotes or offers. The tax points, including how rental income is taxed inside and outside a company, are general context to explain the trend, not advice on your position. If you want to size the likely cost before you read on, an incorporation and transfer cost calculator on the limited company property finance site lets you sketch the SDLT and finance figures, though only your accountant can confirm your actual tax liabilities.

What incorporation means: a sale at market value

Start with the mechanics, because they drive everything else. When you transfer a personally owned rental property into your own limited company, the law treats it as a sale at open market value between connected parties. You dispose of the property at what it is worth today, and the company acquires it at the same value. The price you originally paid is irrelevant to the transfer itself, and so is the fact that no money may actually change hands. HMRC looks through that and taxes the transaction as though you had sold to a stranger at full value.

This is the crucial difference between converting an existing portfolio and buying new through a company. A new purchase is just the company buying a property; there is no prior owner to tax. A transfer has a seller, you, sitting on years of gain, and that gain crystallises the moment you incorporate. It is the reason the market splits so sharply by new-versus-existing. Paragon Bank’s analysis shows roughly 43% of mortgaged buy-to-let purchases went through a limited company in 2025, while only about 11.5% of buy-to-let remortgages did, and Paragon is explicit that the remortgage figure lags precisely because moving an existing property into a company is a taxed event. Landlords are happy to buy new in a company; they are far more cautious about moving what they already own.

The appetite to convert is real, though. On Paragon’s research with BVA BDRC, about 32%, almost a third, of the landlords surveyed said they intend to transfer property held in their personal name into a company in future. The wider shift is the backdrop: Hamptons, analysing Companies House data, counted 443,272 active buy-to-let companies at the end of 2025, nearly five times the 2016 figure, with a record 66,587 set up in 2025 alone. The driver is Section 24, which we come to below. But intending to incorporate and actually doing it are separated by a tax bill, and understanding that bill is the whole job before you move.

Capital gains tax, the SDLT surcharge and incorporation relief (not tax advice)

There are, broadly, three tax events to plan for in the incorporation process, and one relief that can defer the largest of them. We set them out here as general context only. The figures, thresholds and reliefs change, they differ across England, Scotland and Wales, and how they land depends entirely on your circumstances. This is accountant territory, not lender territory, and you must take professional advice before acting.

The first event is capital gains tax (CGT). Because the transfer is a disposal at market value, the gain you have built up over the years of ownership is realised, and CGT can fall due on that gain even though you have not sold to an outside buyer and may have received no cash. For a landlord who bought years ago in a rising market, this can be the single biggest number in the whole exercise, and it is the reason many portfolios never move. Whether and how much CGT arises depends on your base cost, your other gains and your circumstances, all of which your accountant works through.

The second event is stamp duty land tax (SDLT). The company is the buyer, and a company buying residential property pays the Stamp Duty Land Tax additional-dwelling surcharge. HMRC raised that surcharge to 5%, up from 3%, for transactions on or after 31 October 2024 (this is the England and Northern Ireland regime; Scotland and Wales run their own). It applies to the value moved into the company, so on a larger portfolio the SDLT cost of incorporating is substantial, and unlike the CGT it is not something a relief generally defers. Some landlords ask whether there is a route to transfer without paying stamp duty at all: in narrow circumstances, where the properties are held in a genuine partnership, a partnership treatment can reduce or remove the SDLT charge, but that is a specialist question of fact that only a tax adviser can answer, and most ordinary transfers cannot avoid an SDLT charge. Treat it as a real, payable cost of putting the company on the title unless your accountant confirms otherwise.

The third event is the refinance. The personal mortgages secured against the properties have to be repaid and replaced with a company facility, because the new legal owner is the company, not you. That is the finance leg we arrange, and the next section is about it.

The relief that does the heavy lifting on the first event is incorporation relief, under Section 162 of the Taxation of Chargeable Gains Act 1992. In general terms, where a genuine property business is transferred to a company as a going concern, wholly or partly in exchange for shares, s162 can allow the capital gain to be deferred by rolling it into the base cost of those shares rather than taxed at the point of transfer. The words doing the work there are genuine business and going concern. Whether your lettings activity amounts to a business for this purpose, rather than passive investment, is a question of fact and degree that has been tested in case law, and it is exactly the sort of judgement your accountant must make on your facts. Incorporation relief addresses the CGT; it does not remove the SDLT surcharge, and the only recognised way to transfer without paying stamp duty in full, the partnership position, is its own specialist question that depends entirely on whether a true partnership exists. Do not assume you can avoid an unnecessary SDLT charge without your accountant confirming the partnership facts first. This is not tax advice, the outcome is circumstance-specific, and you need a qualified adviser before you commit.

The reason landlords go through all of this is Section 24. HMRC’s finance cost restriction, phased in from April 2017 and fully in force from April 2020, stops individual residential landlords deducting mortgage interest from their rental profit and instead gives them only a basic-rate, 20%, tax credit. Inside a company, the picture changes: rental income is taxed as company profit, mortgage interest stays fully deductible against that profit, and the profit is charged to corporation tax rather than to your personal income tax bands. For a higher or additional-rate landlord carrying real debt, the gap between income tax with restricted interest relief and corporation tax with full deductibility can be large, and it is why the new-business pipeline has tilted so hard toward companies. Note that corporation tax is only the first layer: drawing the rental income back out as dividends or salary is a second taxed step, which is again your accountant’s territory and not ours. Whether it justifies the cost of moving an existing portfolio is the calculation, and it is a tax-and-finance calculation done with your accountant, not a finance decision alone.

Incorporation is a sale at market value, so it is a taxed event, and that one fact shapes everything that follows.

The mortgage refinance leg we arrange

This is the part we own. Whatever your accountant concludes on CGT, SDLT and incorporation relief, the properties cannot legally sit in the company until the personal mortgages are cleared and a company facility takes their place. The incorporation refinance is that facility: a new company buy-to-let or portfolio loan, written to the SPV, that repays your personal borrowing and registers the new charge against the company-owned title.

On a clean SPV, indicative company buy-to-let lending runs up to 75% of value, with pricing stepping at 65%, 70% and 75% loan to value. A new company with no trading history is not penalised on this; lenders price the structure, the directors behind their personal guarantees, the property and the rent, not the age of the company. That up-to-75% loan can also be sized to fund part of the transaction costs of the incorporation itself, rather than just matching the debt you already had, which matters when you are facing an SDLT bill on the way in.

The reason the company loan often releases more than the personal mortgage it replaces is the interest cover ratio. Company buy-to-let is commonly stressed at 125% interest cover, against 145% for a higher-rate personal borrower, because the company deducts its interest in full. On the same rent, that lower stress lets the company carry more debt. The stress rate applied is commonly around 5.5%, but five-year fixes are frequently tested at or near the pay rate, which loosens the cover test further and can release a larger loan again. So a landlord moving a property worth, say, considerably more than the small mortgage left on it can often draw a meaningfully bigger company facility, and that released capital can help meet the costs of incorporating or fund the next purchase. It is the one genuinely positive piece of arithmetic in an otherwise costly exercise.

The lenders for this are matched to the structure. We work whole-of-market across a panel of more than 100 lenders, and for SPV and portfolio incorporations the active names include Paragon, Kent Reliance, Fleet Mortgages, Foundation Home Loans, Landbay and Precise Mortgages, with Paragon, Landbay, Foundation Home Loans and Shawbrook among the lenders with genuine portfolio appetite. We talk about their appetite and where they sit, never a specific rate as an offer, because pricing is set case by case. Part of the value of a broker here is access: several strong lenders, including The Mortgage Works, Leeds Building Society and Coventry Building Society, are intermediary-only and cannot be approached directly at all, so the panel is wider than a landlord can reach alone.

Buy-to-let lending to a limited company is, in almost all cases, unregulated business lending that sits outside the Financial Conduct Authority’s regulated mortgage perimeter. We are not authorised by the FCA. Where a deal carries a regulated element, for example a consumer buy-to-let or a director’s own residence, we refer it to an appropriately regulated firm.

Advantages and disadvantages: when incorporating makes sense, and when it does not

It is worth setting the advantages and disadvantages side by side before anyone reaches for a calculator. The advantages are mostly long-term and structural: rental income taxed at corporation tax rates with full interest deductibility, profit you can retain and reinvest rather than draw and be taxed on, and cleaner succession and ownership planning across a portfolio. The disadvantages are mostly upfront and certain: the CGT and SDLT due on the way in, the cost and admin of running a company, and tighter, fee-loaded company mortgage pricing. The advantages compound over years; the disadvantages land in cash on day one. That timing mismatch is the whole tension in the decision.

The honest answer is that incorporating an existing portfolio makes sense far less often than buying new in a company does, and the split runs along the new-versus-existing line. For a new purchase, the company route is close to a default for a higher-rate landlord: there is no disposal, no CGT, and the only extra cost over a personal purchase is the SDLT surcharge that, in 2026, a company and an individual buying an additional property both face anyway. For an existing property, you are paying to move something you already own, and the CGT and SDLT on the way in can swallow years of the Section 24 saving the move is meant to produce.

That is why the maths usually favours moving newer holdings with smaller gains, rather than the long-held flat that has trebled in price and would generate a large CGT bill on transfer. It favours higher-rate and additional-rate landlords with real mortgage debt, because they are the ones Section 24 hurts most and full interest deductibility helps most. And it favours landlords with a genuine, active property business of some scale, both because the long-term company benefits, profit retention, controlled extraction and succession planning, are worth more across a real portfolio, and because the going-concern test that incorporation relief depends on is more likely to be met by a substantial lettings business than by a single passive let. The rise in multi-shareholder companies, 42% of new 2025 companies on the Hamptons data had more than one shareholder, points to exactly this kind of deliberate, family and portfolio-scale structuring.

It often does not make sense for a landlord with one or two low-debt properties sitting on large pent-up gains, where the CGT and SDLT to incorporate dwarf any annual tax saving. It does not make sense if your lettings activity is unlikely to clear the going-concern bar for incorporation relief and the full CGT would therefore fall due now. And it should never be done on the finance arithmetic alone: a bigger company loan at 125% cover is attractive, but it does not, on its own, justify triggering a tax event. The order of work is your accountant first on whether to move, then us on how to fund it. We say this plainly because we see landlords drawn to the borrowing upside without having costed the tax. None of the above is tax advice; it is the general shape of the decision, and your own answer needs a qualified adviser.

The costs and the numbers on a worked example

It helps to put indicative numbers around it, while being clear these are illustrative and not a calculation of anyone’s actual liability. Take a landlord holding a single buy-to-let, owned personally, with a market value of 300,000 pounds and a personal mortgage of 120,000 pounds left on it, sitting on a sizeable gain built up over years of ownership.

On incorporation, that 300,000 pound value is treated as a sale to the company. The SDLT is the clearest cost to picture: the company buyer pays Stamp Duty Land Tax on 300,000 pounds including the 5% additional-dwelling surcharge that has applied since 31 October 2024, and that surcharge alone is a five-figure sum on a property of this size, payable in cash on completion of the transfer. The capital gains tax depends entirely on the base cost and the landlord’s circumstances, and this is where incorporation relief may or may not come in: if the lettings activity qualifies as a business transferred as a going concern, s162 may defer the CGT into the value of the shares received, but if it does not, CGT on the full gain could fall due now. Only the accountant can say which, and the gap between those two outcomes is often the whole case for or against the move.

The finance leg is the part we can size with more confidence. Against the 300,000 pound value, a company loan up to 75% loan to value gives indicative borrowing of up to around 225,000 pounds on a clean SPV, subject to the rent passing the 125% interest cover test at the stress rate. That repays the 120,000 pound personal mortgage and, in principle, leaves headroom that can be applied to part of the incorporation costs or held back for the next purchase, where the rent supports it. The same property in personal name, stressed at 145%, would typically support a smaller loan on the same rent, which is the structural reason the company facility can release more. Read the rate and the arrangement fee together, because company products are fee-loaded and the headline rate alone does not tell you the cost.

So the shape of the example is: a real, payable SDLT cost and a potential CGT cost on the way in, set against full interest deductibility and a larger, 125%-stressed company loan going forward. Whether the second outweighs the first over your holding period is the calculation, and only your accountant can complete it for your figures. We size and arrange the loan; we do not give the tax answer. Every number here is indicative market commentary and general context, not advice on your position.

Talk to us

If you are weighing whether to move a portfolio into a company, start with your accountant on the tax, because the CGT, the SDLT surcharge and whether incorporation relief is available are what decide if it is worth doing at all. Once you have that answer, the earlier we see the properties, the rents and the existing mortgages, the better we can shape the company refinance: a realistic read on the loan to value, the interest cover, how much the company facility can release over the personal debt, and the lenders whose appetite genuinely fits the structure. We will model the finance leg, work alongside your adviser, and match the deal across our 100-plus lender panel, including the intermediary-only names you cannot reach directly. To get started, talk to a limited company property finance specialist.

Buy-to-let lending to a limited company is, in most cases, unregulated business lending and falls outside the FCA’s regulated perimeter. We are not authorised by the Financial Conduct Authority. Where a deal involves a regulated element, we refer it to an appropriately regulated firm. Everything here is general information and indicative market commentary, not regulated financial advice. The tax points, including capital gains tax, the SDLT surcharge, incorporation relief and Section 24, are general context only and not tax advice; take advice from a qualified accountant or tax adviser on your own position before acting. This article was written by Matt Lenzie.