How to Incorporate Your Property Portfolio

aafra9
Sep 2
2 min read

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Step-by-Step Guide: How to Incorporate Your Property Portfolio

1. Who qualifies to incorporate a property portfolio?

To qualify, you must be running a genuine property business and not just holding passive investments. HMRC looks at factors such as:

Time spent managing the portfolio (usually 20+ hours per week)

Active involvement in tenant management, repairs, and finances

2. Do I need a professional valuation before incorporation?

Yes. You’ll need an independent valuation of your properties and any outstanding mortgages. This ensures accurate transfer values and helps in calculating potential tax liabilities.

3. How do I transfer my properties into a limited company?

First, set up a limited company at Companies House.
Transfer ownership of the properties into the company.
Complete the conveyancing process (similar to a property sale).
Get mortgage lender approval to move loans into the company name.

4. Will I pay Capital Gains Tax (CGT) when incorporating?

Normally yes, but you may qualify for Incorporation Relief (under Section 162 TCGA 1992).

This relief defers CGT until you sell shares in the company, helping you avoid a large immediate tax bill.

5. What about Stamp Duty Land Tax (SDLT)?

Transferring property into a company can trigger SDLT. However:

Partnership exemptions may reduce or eliminate SDLT liability in some cases.
Professional planning is essential to avoid unnecessary costs.

6. What legal and tax updates are needed after incorporation?

Register the company with HMRC for Corporation Tax.
Update tenancy agreements to reflect the company as the new landlord.
Register for Self-Assessment (and VAT if relevant).

7. What ongoing compliance is required?

Once incorporated, you must:

File annual accounts and Corporation Tax returns.
Maintain directors’ duties and Companies House compliance.
Keep accurate bookkeeping and tax planning in place for efficiency.

8. Why should I incorporate my property portfolio?

Potential tax savings (through Incorporation Relief, SDLT planning, and lower Corporation Tax rates).
Greater flexibility for future investment and succession planning.
Separation between personal assets and business assets.

Ready to Incorporate Your Property Portfolio?

At PKPI, we specialise in helping landlords and property investors structure their portfolios in the most tax-efficient way. From Incorporation Relief to SDLT planning, our expert property and dental accountants guide you at every step.

👉 Book your free consultation today and discover how much tax you could save.

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