More than 5,000 new limited companies were set up in September to hold buy-to-let homes in Great Britain, according to new figures from Hamptons.

The research also revealed that 46,449 companies were set up between January and September 2024 - a 23 per cent rise on the same period last year and more than the total for 2021.

 

According to Hamptons the increase has been driven by the different ways buy-to-lets in companies and buy-to-lets in personal names are taxed. 

With landlords no longer able to fully claim mortgage interest as a cost, more new purchases are going into a company structure. 

And existing investors are also shifting their buy-to-lets into limited companies to reduce their tax burden. Given that properties sold by companies are not subject to Capital Gains Tax, any increase will deepen this divide.

By the end of October 2024, it’s likely that more limited companies will have been set up to hold buy-to-let property than in the whole of 2023. 

This means that by the end of 2024, between 60,000 and 62,000 limited companies will have been created, exceeding last year’s total of 50,004.  

Aneisha Beveridge, head of research at Hamptons, said: “While landlord purchase numbers are well down on pre-pandemic levels, there’s been no sign of a slowdown in the number of companies being set up to put them in. 

"Most new purchases are now made in a company structure.  However, there’s also been a significant rise in the number of landlords moving homes they own in their personal name into a company to shelter from an increasingly aggressive tax environment."