| Buy to let tax information can be few and far | | | | the meantime. |
| between and difficult to find for the new landlord | | | | Conversely, small companies pay just 19% corporation |
| entering the buy to let market. | | | | tax on their rental income. However, when money is |
| One of the most common questions is should I | | | | taken out of the business as a dividend, higher rate |
| purchase and run my buy to let property through I | | | | taxpayers incur a further tax charge of 25%. If the |
| limited company or as a personal investment. Well | | | | properties are sold and the company wound down, |
| there are a number of factors and taxes to consider | | | | capital gains tax is charged on the lot at a minimum of |
| before making any information | | | | 24% assuming you have held on to the properties for |
| Income Tax | | | | ten years. So, you would lose about 40% in tax. |
| Running your buy to let property through a company is | | | | Capital Gains Tax |
| a great way to avoid paying income tax. So long as | | | | If and when you sell any of your properties at any |
| you do not take any profits out of the business, or in | | | | time in the future you will have to pay capital gains tax |
| other words you reinvest the profits back into the | | | | on any profit made in the capital gain. Currently in the |
| business for future re-investment. Assuming you do | | | | UK this is 18% however rates vary for limited |
| this you will be increasing the future value of the | | | | companies. |
| company and not paying any additional income tax in | | | | |