Landlords aim to beat tax rises

A growing number of property investors are choosing to acquire buy-to-let homes through corporate vehicles to get around paying an extra 3 per cent above existing stamp duty rates on second homes, mortgage brokers report. There has been a surge in demand for buy-to-let properties in recent months from investor landlords keen to beat the 1st April deadline for the stamp duty surcharge. But to avoid the hit, it has been reported that a growing number of landlords are setting up company structures to manage their rental properties. Mortgages for Business report that it has seen the proportion of applications acquiring property within a corporate vehicle surge from 18 per cent to more than 50 per cent in the past six months. Forming company structures to manage their rental properties will also enable many landlords to continue to deduct mortgage interest from their tax bill as it will be viewed as a business expense. This will allow higher rate taxpayers to more than halve their tax bill because they will pay corporation tax, rather than income tax, which will be 19 per cent from 2017, and will fall to 18 per cent by 2020. Similarly, the ability to take income…

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