Buying a buy-to-let through a limited company.
The tax treatment can favour a company, but that is only one side of the decision.
A Scottish property solicitor told us that 99.9% of the new buy-to-let buyers crossing her desk now purchase through limited companies.
That is one solicitor's experience, not a national market-share figure. It does explain why the company question now comes up so often before a new purchase.
Mortgage interest is treated differently
An individual landlord cannot deduct residential mortgage interest from rental income as an ordinary expense. The current system gives a basic-rate tax reduction instead. That reduction is 20% today and becomes the 22% property basic rate from the 2027 to 2028 tax year under the Finance Act 2026.
A limited company can normally deduct interest when calculating its taxable profit. That difference matters more to a landlord whose personal property income falls into a higher tax band.
It does not settle the answer by itself. Company profit is subject to Corporation Tax, and taking money out can create a second personal tax charge. A comparison needs to include how much profit will stay in the company and how much the owner expects to draw.
A company still has costs
A company needs annual accounts, a Corporation Tax return, Companies House filings and its own records. Mortgage pricing and product availability can also differ from personal borrowing.
Scotland's Additional Dwelling Supplement applies to an additional residential purchase whether the buyer is an individual or a company. Buying through a company does not remove it.
Moving an existing property is a separate transaction
Choosing a company for the next purchase is not the same as moving a property you already own. A transfer to your company can involve LBTT, ADS, Capital Gains Tax, lender consent, refinancing and legal fees.
Do not treat incorporation as an administrative change. Ask an accountant and solicitor to model the transfer before committing to it.
Shares create options, not automatic tax savings
Company shares can be divided or transferred without changing the title to each property. That can be useful when bringing in a co-owner or planning succession. The transfer of shares can still have tax and legal consequences. The useful point is flexibility, not a promise that the transfer will be free.
The owner belongs in every property record
The company is the legal owner. It owns the property, signs the mortgage and tenancy documents, receives the rent and pays the costs. Its bank records and filings must remain separate from those of another company or the landlord personally.
Lar starts with that legal owner. Properties, mortgages, transactions and compliance evidence sit underneath it, while the portfolio view can still bring the numbers together.
Weighing up your next purchase? The companion guide, Limited company or personal name: five questions, sets out the conversation to have with your accountant.
Keep the legal owner attached to every number.
Lar separates personal holdings, companies and partnerships without losing the consolidated portfolio view.
Nothing in this guide is tax or legal advice. Rates and reliefs are as legislated at the time of writing. Talk to your accountant about your specific numbers.