Should Rental Properties Be Owned Personally or Via A Company?

If you either already have rental properties or are thinking of purchasing some, it is worth considering the different factors that will affect your decision on whether they should be owned by you personally or by a company.


Typically, income tax rates will be higher than corporation tax rates so that if profits are re-invested there will less available if owned personally rather than through a company.

However, if owned personally, once the tax has been paid, the profits can be withdrawn by the owner with no additional tax charge. If owned by a company and the owner wants to withdraw the profits, there would be a further tax to pay on the withdrawal.

Starting from the 2017/18 tax year, tax relief for mortgage interest is gradually being restricted for personally owned residential property making corporate ownership more attractive.


There are different Capital Gains Tax levels and allowances for property sales or gifts depending on whether the property is owned personally or via a company and depending on what tax rate band the owner is in.

If the property sold was owned individually, the cash is available to the owner whereas if the property was owned by a company, the cash is held within that company until extracted (which then triggers further income or capital gains tax liabilities).


Personal ownership is generally considered to be the most tax efficient option for most people. However, corporate ownership is still worth considering where a portfolio is built up and repeat re-investment is planned.

This could be the case if you want to build up a large fund within your company to use as a pension pot to gradually draw dividends over a long period.

However, it is also worth bearing in mind that to transfer properties from personal to company ownership would incur a further stamp duty land tax charge.

Depending on your circumstances there may also be other factors to consider so we would always advise contacting us to get professional advice.