Landlords across the UK are increasingly using limited companies to hold investment property. And it’s not just a trend—it’s a strategic tax play.

With Section 24 removing mortgage interest relief for individual landlords, and rising personal tax rates, buying through a Special Purpose Vehicle (SPV) can reduce your liability and increase your net return.

But limited company mortgages work differently—and they come with their own quirks.

What is a limited company mortgage?



It’s a buy-to-let mortgage issued to a UK limited company, typically set up solely to hold property. These are often structured as SPVs, using standard SIC codes like 68100 (Buying and selling of real estate).

In this setup:

• The company owns the property
• The directors/shareholders provide personal guarantees
• Rental income flows into the company, not you directly
• Tax is paid under Corporation Tax rules

In 2025, around 60–70% of new BTL purchases are done via SPVs.

What are the tax benefits?

This is the big driver. The shift to limited companies makes sense for many landlords because:

📉 Mortgage interest is 100% deductible from rental profits (unlike personal ownership)
🏦 Corporation Tax is often lower than personal income tax (currently 19–25%)
💷 Retained profits can be reinvested into more property without dividend tax
🧾 Estate planning and ownership structuring are easier via company shares

But it’s not all upside—you’ll need to consider:

• Annual accounts and Companies House filing
• Potential double tax (Corp Tax + Dividend Tax if drawing income)
• Higher upfront costs and legal complexity

Always speak to a property tax accountant before deciding.

Do I need a trading company or SPV?

Nearly all limited company mortgage lenders prefer you to use a dedicated SPV. This is:

• A company set up for property investment only
• Usually with SIC codes like:

• 68100 (buying and selling real estate)
• 68209 (other letting and operating of own property)

Using a trading business (e.g., one that also operates a shop or consultancy) will limit your mortgage options.

Who offers limited company mortgages?

The market has grown significantly. In 2025, lenders include:

🏦 Specialist BTL lenders (e.g., Paragon, Precise, Landbay)
🏢 Challenger banks (e.g., Aldermore, Shawbrook)
🔐 Private banks (for large portfolios or HNW borrowers)
🧮 Building societies (selective cases)

Expect:

• Rates from 4.5%–6.5% (based on risk and LTV)
• Arrangement fees from 1%–2%
• Up to 80% LTV, though 75% is most common
• Flexible income and credit rules—focus is on the deal

Can I transfer personally owned property into a company?

Yes—but there are major tax traps to consider:

⚠️ Capital Gains Tax (CGT) on disposal (even to your own company)
⚠️ Stamp Duty Land Tax (SDLT) on the purchase
⚠️ Possible mortgage early repayment charges

Some landlords qualify for Incorporation Relief, particularly if:

• You run the portfolio as a genuine business
• You own multiple properties
• You can prove significant management activity

This needs proper legal and tax advice.

What about mortgages for trading companies?

While SPVs are preferred, some lenders will lend to trading companies if:

• The main activity is property investment
• Property income is separate and easy to track
• Directors have strong financial profiles

But you'll have fewer lender choices, and underwriting will be stricter.

How to apply for a limited company mortgage

Here’s what’s needed:

📄 Certificate of incorporation
📑 Memorandum & Articles (often must be standard form)
🧾 Company bank statements
📊 Proof of rental income or proposed rent
📈 Business plan or income forecast (sometimes)
📃 Director guarantees and ID documents

A broker can help prepare the right structure and avoid delays.

Why work with a specialist broker?

At Willow, we handle hundreds of limited company mortgages each year. We:

✔️ Advise on the SPV setup and structure
✔️ Source the best limited company deals from across the market
✔️ Package the application to lender requirements
✔️ Liaise with solicitors, valuers, and underwriters
✔️ Guide you on tax considerations with your accountant

Whether you're buying your first BTL or scaling a 10-property portfolio, we’ve got you covered.

📞 Want Help Navigating Today’s Market?

Book a free strategy call with one of our mortgage specialists.

We’ll help you find the smartest way forward—whatever rates do next.