What is a Limited Company Buy to Let Mortgage?

A limited company BTL mortgage is taken out through a Special Purpose Vehicle (SPV) - a company set up to own rental properties. The company owns the property and the mortgage. Benefits include full mortgage interest tax relief, 19-25% corporation tax (vs up to 45% income tax), and flexible profit extraction. Rates are typically 0.5-1% higher than personal BTL mortgages, but tax savings often outweigh this for higher-rate taxpayers.

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What is a limited company buy to let mortgage?

A limited company BTL mortgage is a buy-to-let mortgage taken out through a Special Purpose Vehicle (SPV) - a limited company set up specifically to own rental properties. The company owns the property and takes out the mortgage, not you personally. This structure offers tax advantages since the 2017 changes to mortgage interest relief.

Is it worth buying a BTL through a limited company?

For higher-rate taxpayers (40%+) with multiple properties, buying through a company is often more tax-efficient. You can offset full mortgage interest against profits, pay 19-25% corporation tax instead of income tax, and have flexible profit extraction. However, personal mortgages may suit basic-rate taxpayers with 1-2 properties.

What is an SPV for buy to let?

An SPV (Special Purpose Vehicle) is a limited company set up solely to own and manage rental properties. It must have SIC codes 68100 (buying/selling property) and 68209 (renting/operating property). SPV mortgages are specifically designed for these companies and differ from standard commercial mortgages.

Are limited company BTL rates higher than personal?

Yes, limited company BTL rates are typically 0.5-1% higher than personal BTL mortgages. However, the tax savings (especially for 40%+ taxpayers) often outweigh the higher interest costs. A broker can calculate which structure is more cost-effective for your situation.

Can I transfer my existing BTL to a limited company?

Yes, but it involves selling the property to your company at market value. This triggers stamp duty (including the 5% additional property surcharge) and potentially capital gains tax on any profit. The costs can be significant, so new purchases are usually better suited to company structure.

How many properties do I need for a limited company BTL?

There's no minimum - you can use a limited company for one property. However, the setup costs (company formation, accountant fees, higher mortgage rates) mean it's typically more beneficial for landlords with 4+ properties or higher-rate taxpayers. A specialist adviser can assess your specific situation.

Quick Answer

Should I Get a Buy to Let Mortgage Through a Limited Company?

Last reviewed: December 2025

Reviewed by Jay Sabine – CeMAP Qualified – 29 years experience

For higher-rate taxpayers and portfolio landlords, yes - tax savings typically outweigh higher rates. Basic-rate taxpayers with 1-2 properties may be better with personal mortgages.

Since the 2017 changes to mortgage interest tax relief (Section 24), many landlords now purchase BTL properties through a limited company structure. When you buy personally, you can only claim a 20% tax credit on mortgage interest. Through a company, you can offset the full interest against rental profits before paying corporation tax (19-25%). For a higher-rate taxpayer with significant mortgage costs, this difference can save thousands annually. The trade-offs include higher mortgage rates (typically 0.5-1% more), setup costs, accountant fees, and more complex administration. It's usually most beneficial for landlords earning 40%+ tax rate, those building a portfolio of 4+ properties, or those looking to pass properties to family tax-efficiently.

Tax treatment depends on individual circumstances and may change. This is not tax advice - consult a qualified accountant. Your property may be repossessed if you do not keep up repayments.

Key Points

1Full mortgage interest relief (vs 20% credit personally)
2Corporation tax 19-25% (vs income tax up to 45%)
3Mortgage rates typically 0.5-1% higher
4Need SPV with correct SIC codes (68100, 68209)
5Easier to add properties to existing company
6More complex administration and accountant costs

Eligibility Criteria

SPV limited company with property SIC codes
Personal guarantee usually required from directors
Good personal credit (lenders assess directors)
Minimum 25% deposit typically required
Rental income to cover 125-145% of mortgage payment

Typical Timeframe

Setting up an SPV takes 1-2 days online. Limited company BTL mortgage applications typically take 4-8 weeks, similar to personal BTL timescales. Having your accountant confirm the company structure meets lender requirements speeds the process.

Next Steps

1Calculate tax position under both structures
2Speak to a property tax accountant
3Set up SPV with correct SIC codes if proceeding
4Gather personal and company documents
5Get advice from a specialist BTL mortgage broker

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Should I Get a Buy to Let Mortgage Through a Limited Company?

Key Points

Eligibility Criteria

Typical Timeframe

Next Steps

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