Should You Buy an Investment Property in Your Name or Through a Company?

Understanding Your Options for Property Investment

Whether you're starting out or growing your portfolio, a big decision is how you structure your property purchase. Should you buy in your personal name, or set up a limited company? This choice affects everything from tax to mortgage rates and future returns.

At Roberts Renovations, we've faced this question ourselves while investing in our own properties. With tax changes like the new Stamp Duty Land Tax (SDLT) rules, it's crucial to understand both options clearly. For more insights, check out our blog on Stamp Duty changes for 2025.

Should You Buy Investment Property in Your Personal Name?

For many first-time landlords and smaller-scale investors, buying in their personal name feels like the simplest route. It’s a natural first step when starting in property.

When you own property personally, rental income is taxed alongside your other earnings, which can push you into higher tax bands. For those already paying 40% or even 45%, this can eat into returns.

However, personal ownership keeps things straightforward. There’s no need for company accounts, and mortgages can sometimes be easier to arrange. Lenders base decisions on your personal credit history rather than company performance. If you're planning to live in the property, personal ownership is usually required.

If you're early in your property journey, our property investment guide offers helpful insights to get started.

Should You Buy Investment Property Through a Limited Company?

More landlords are turning to limited companies for their property purchases, and for good reason.

The biggest advantage lies in tax efficiency. Rather than paying personal income tax, company profits are taxed at 25%. Plus, there’s greater flexibility to offset costs against profits.

That said, limited company mortgages often come with higher rates — particularly during the first six months. From experience, we’ve found rates tend to be significantly higher immediately after purchase but drop after that initial period. If you have cash available, buying outright and remortgaging later can be a smart move to access better rates. Always work with a trusted broker for the best results.

Operating through a company does bring extra costs, like setup fees and annual accounting. But for investors growing a larger portfolio, these costs often pay for themselves.

For landlords focusing on rentals or HMOs, this structure can work well. Explore our property investment insights to see if it suits your strategy.

Tax Considerations for Property Investors

Tax plays a major role in deciding your ownership route.

Personally owned property income is taxed at your personal rate — often 40% or more. Capital gains tax also applies at 18% or 28% on sale, depending on your income bracket.

In contrast, companies pay corporation tax at 25%, and any capital gains from property sales are taxed at this same rate. While extracting profits as dividends or salary involves personal tax, many investors leave profits within the company to reinvest and grow their portfolio.

There’s also Stamp Duty to consider. Company purchases attract the 3% surcharge on additional properties. For a full update, read our Stamp Duty guide, or check Zoopla’s helpful stamp duty surcharge explainer.

Mortgage Options for Property Investors

Your mortgage options can vary dramatically based on ownership structure.

If you buy personally, you'll generally find more lenders and competitive rates. Lenders assess your individual circumstances, and if you have a strong credit profile, you could enjoy better terms.

For limited company purchases, rates are usually higher, and lenders often require larger deposits and stricter affordability checks. However, working with a good broker can help you secure better deals, especially after that crucial initial period.

At Roberts Renovations, we’ve found that cash buyers who re-mortgage after six months often unlock far better rates, improving cash flow and strengthening investment returns.

Flexibility and Future Planning for Property Investors

Thinking long-term, company ownership offers flexibility.

Transferring shares in a company can be simpler and more tax-efficient than transferring personally owned property. For those thinking about succession planning, this could ease future inheritance tax burdens.

Company ownership also helps retain profits for reinvestment, avoiding personal tax charges when reinvesting into new projects.

To see how we help investors plan for the future, explore our property investment services.

Common Mistakes to Avoid When Choosing Ownership Structure

It’s easy to be swayed by headline tax rates or trends. But don't overlook the full picture.

Many overlook the costs of running a limited company — including accounting fees and admin. Equally, don’t assume company ownership is automatically best for everyone.

Smaller portfolios can still thrive under personal ownership.

Careful planning is essential. Look at your long-term goals, desired portfolio size, and exit plans before deciding.

Final Thoughts: Personal Name vs Limited Company for Property Investment

There’s no one-size-fits-all answer to this decision. What works best depends on your goals, strategy, and how you plan to grow your portfolio.

If you’re building a small number of properties, personal ownership might work well. For those looking to scale, a company structure could be more tax-efficient.

No matter your path, planning is key. Take time to weigh your options and seek professional advice. For more insights, explore our regional guides: Leeds, York, Wakefield, and Bradford.

FAQs: Buying Property Personally vs Through a Limited Company

Is it cheaper to buy property through a limited company?

It can be, especially when scaling. Corporation tax is lower than personal income tax, but setup and ongoing costs, plus mortgage rates, must be considered.

Can I move my personally owned property into a company?

Yes, but it may trigger capital gains tax and stamp duty. Always seek professional advice before making this move.

How does stamp duty work for company purchases?

Limited companies typically pay the 3% surcharge on additional properties. Check our Stamp Duty blog for details.

Are mortgages more expensive for companies?

Usually, yes — especially at the start. But rates often improve after six months, so work with a trusted broker to explore options.

Do landlords need to buy property in a limited company?

Not necessarily. Many landlords buy personally, especially for smaller portfolios. Companies suit those aiming to scale.