How does an SPV limited company mortgage help with succession planning?

So, you’ve built up a successful portfolio of buy-to-let properties – but who will inherit them after you’ve gone? We all want to pass on our wealth and assets to our loved ones; but when it comes to investment properties, it’s tricky to pass them on without also saddling your children with extra tax liability.

But by holding your BTL properties in a limited company, you can simply transfer shares of the company to your loved ones at a reduced or nil cost – thereby incurring zero stamp duty land tax on the properties held within it and potentially zero stamp duty tax on the disposal of the shares. Tax can still arise. When a company sells a property, the gain is charged to corporation tax. When you give away or sell shares in the company, capital gains tax can apply to you personally, and transfers to family are treated as taking place at market value. Gifts can also have inheritance tax consequences. Take tax advice first.

And it gets better; as long as 100% of your own company shares have been passed on to your family before you pass on, you’ll mitigate 100% of inheritance tax as well.

At LimitedCompanySPVMortgages.co.uk, our mortgage broker experts can help you transfer your existing portfolio to a ‘special purpose vehicle’ limited company, and/or secure an SPV mortgage to help you develop your portfolio even further before you retire.

Get in touch to find out more!