Personal to Limited Company

Personal to Limited Company

9:00 AM, 8th November 2017, About 7 years ago 4

Text Size

We are the process of change from personal to limited for our property portfolio. Do all of the properties need to be transferred to one company or can they be transferred to two companies as long as they are all transferred. I also have existing companies with portfolios in. The main reason for this situation is due to size of the portfolio and the banks criteria of no more than £5,000,000 with one company.

Thanks

Justin

Reply from Mark Alexander

Hi Justin

I’m not familiar with with the lending criteria you’re referring to but would your lenders be happy with one holding company and multiple subsidiaries?

In regards to your question “Do all of the properties need to be transferred to one company” it is not entirely clearly why you are asking this. Are you are referring to the ‘whole business’ transfer rules under s162 TCGA 1992 which provides incorporation relief to roll capital gains into shares in the company the business is being transferred into?

Show Book a Tax Planning Consultation

Please visit the book a tax planning consultation page to book your consultation!


Share This Article


Comments

Neil Patterson

Become a Member

If you login or become a member you can view this members profile, comments, posts and send them messages!

Sign Up

9:40 AM, 8th November 2017, About 7 years ago

Hi Justin,

Do you know if you will be paying SDLT and CGT upon the transfer?

Justin Bryce

Become a Member

If you login or become a member you can view this members profile, comments, posts and send them messages!

Sign Up

14:08 PM, 8th November 2017, About 7 years ago

Hi Neil and Mark
Thank you for your response.
I will be transferring all of the personally owned properties from my wife and me using the transfer rules under s162 TCGA 1992. There will be no SDLT or CGT as we are rolling the capital into shares. I have paid the initial £400 but I have not quite completed the forms. The reason for me asking ' do all of the properties need to be transferred to one company' is because the lenders may only lend £5,000,000 to one of my new companies so I would therefore set another company up to transfer the rest (Paragon Bank) albeit at the same time.

Neil Patterson

Become a Member

If you login or become a member you can view this members profile, comments, posts and send them messages!

Sign Up

14:52 PM, 8th November 2017, About 7 years ago

Hi Justin,

Maximum exposure limits apply to the maximum any one lender will lend to an individual or company.

It is not the maximum you are aloud to borrow in total across lenders.

Mark Alexander - Founder of Property118

Become a Member

If you login or become a member you can view this members profile, comments, posts and send them messages!

Sign Up

16:31 PM, 8th November 2017, About 7 years ago

Reply to the comment left by Justin Bryce at 08/11/2017 - 14:08
Hi Justin

Until we have completed the Fact Find element of the consultation process it would be unwise for us to provide guidance on this point. We don’t even know at this stage whether incorporation is going to be the optimal strategy for you. Even if it is, there are three financing strategies to consider; 1> refinance, 2) novation and 3) BICT.

I suggest we look at this a step at a time.

Leave Comments

In order to post comments you will need to Sign In or Sign Up for a FREE Membership

or

Don't have an account? Sign Up

Landlord Automated Assistant Read More