Saving Tax on BTL Portfolio
David Saunders
I help business owners and individuals protect what is most important to them . I also provide Mortgage and Life Protection Guidance and now I am learning how to help people profit from Trading.
* If properties are held in a landlord’s own name who pays top rate tax (40-45%), our platform transfers properties into a company without incurring any Stamp Duty or Capital Gains Tax (CGT):?
* So we run properties through an LLP for three Fiscal Years (min’ 14mths -max’27mths), nothing actually changes; until we then transfer the props’ into UK Co’.?
* By moving out of own name paying 45% tax, they will now only pay corporation tax which would be a reduction from 45% to 19%.
* By moving into a company, the landlord can now offset all mortgage/financing costs against rental income tax. They can offset all business expenses such as petrol, entertaining etc.... They will end up paying very little tax on the rental income;
* Now they have their properties in the company and the rental income coming into the company they can set up a corporate pension plan which they couldn’t do when it was all in their own name – this is all tax offsettable as well of course;
* Finally: we try to insist they go & see a Will writer & Lasting Powers of Attorney specialist given that their properties are no longer in their names & there is a new Corporate entity.?
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If properties are owned already in a corporate, the benefits obviously don’t reduce the income tax - but achieve the same, additional benefits as for individual ownership, as follows :
* We completely wipe the slate clean of any existing CGT which may have built up over the past 5/10/15 years;
* We also produce a wrapper around the new company to protect the portfolio entirely from Inheritance Tax (IHT);
* We also enable the landlord to extract the entire Net Asset value of the properties, after all debt’s removed, out of the new Co’, entirely tax-free.
Hopefully you will agree that this represents significant benefits for any landlord to be able to maintain their holdings without having to sell & face severe, even penal tax penalties, thus maintaining their property holdings effectively as?their pension platforms which was the intention at the beginning.
David Saunders
01932 428925