Since Section 24 restricted personal mortgage interest relief, more landlords have been looking at limited company structures for buy-to-let. Whether it is right for you is a tax question, not a mortgage one. This guide covers what a limited company BTL mortgage actually involves, what lenders require, and how the rates and criteria compare to buying personally.
A limited company buy to let mortgage is taken in a company's name rather than personally. Most lenders require the company to be a Special Purpose Vehicle (SPV) set up solely to hold property. Rates are higher than personal BTL, the ICR stress test is tighter (145% vs 125%), and directors must provide personal guarantees. Whether a limited company makes tax sense is a question for an accountant, not a mortgage broker.
A limited company buy to let mortgage works the same way as a personal buy to let mortgage mechanically , the lender provides a loan secured against an investment property and the borrower repays it with interest. The difference is the borrower is a limited company, not an individual. The company owns the property, receives the rent, and is responsible for the debt.
This matters because the tax treatment is different, the lender pool is different, the rates are different, and the application process is more involved. The mortgage side is manageable. The tax side is where most landlords need proper advice before making a decision.
Woodhall Mortgages is a whole-of-market, FCA-authorised broker (FRN 762513) based in Halifax, West Yorkshire. We advise on limited company buy to let mortgages from specialist lenders across the full market. We do not provide tax advice , a qualified accountant should be your first call before deciding on ownership structure.
Limited company BTL has grown significantly since the Section 24 changes restricted personal landlords from deducting full mortgage interest against rental income. A limited company can still deduct mortgage interest as a business expense, which changes the tax maths for many higher-rate taxpayers. But a limited company is not automatically better , it depends entirely on your individual tax position, and the higher mortgage rates eat into the tax advantage.
The mortgage differences are straightforward. The tax differences need an accountant. Here is the mortgage picture.
| Personal buy to let | Limited company buy to let | |
|---|---|---|
| Who borrows | Individual in personal name | Limited company (usually SPV) |
| Mortgage rates | Lower , wider lender market | Higher , specialist lenders only |
| ICR stress test | 125% (standard) | 145% (higher bar) |
| Lender choice | Full market including high street | Specialist lenders only |
| Personal guarantee | Not required | Required from all directors |
| Mortgage interest relief | Restricted (Section 24) | Full deduction as business expense |
| Profit tax | Income tax (20%, 40% or 45%) | Corporation tax (19% to 25%) |
| Extracting profits | Direct , rental income is yours | Via salary or dividends (further tax) |
| Application complexity | Standard | More complex , company + director review |
| Portfolio landlord rules | Apply at 4+ properties | Apply at 4+ properties |
Corporation tax rates correct as of 2026 , review annually as rates are subject to change. Tax treatment depends on individual circumstances. Always take independent tax advice.
A limited company is not automatically more tax-efficient. Higher mortgage rates, the cost of extracting profits via dividends, accountancy fees and the complexity of company administration all affect the real-world numbers. For some landlords the limited company route works well. For others the additional cost outweighs the tax benefit. An accountant who specialises in property investment should model your specific situation before you commit to either structure.
The application involves more moving parts than a personal BTL. Here is what lenders typically look at.
Most lenders require the borrowing entity to be a Special Purpose Vehicle with SIC code 68100 (buying and selling own real estate) or 68209 (other letting and operating of own or leased real estate). Trading companies with other business activities are generally not accepted. The company must exist solely to hold investment property.
Rental income must cover the mortgage payment by at least 145% at the lender's stress test rate. Personal BTL typically uses 125%. On practical terms, the same property needs to generate more rent to qualify for a limited company mortgage than a personal one at the same loan amount. This can rule out lower-yielding properties.
Every director must provide a personal guarantee. If the company cannot service the debt, the lender comes after the directors personally. This is worth being very clear on before signing , it significantly reduces the liability protection that a limited company otherwise provides.
Lenders need incorporation documents, SIC code confirmation, details of all directors and shareholders, and confirmation the company was set up for property investment. New SPV companies are acceptable to most specialist lenders , you do not need trading history.
Even though the mortgage is in the company name, lenders assess the directors personally. Credit checks, income verification and existing financial commitments are all reviewed. A director with adverse credit will reduce the available lender pool significantly. For self-employed directors see our self-employed mortgage guide.
Most limited company BTL lenders require a minimum 25% deposit, matching standard personal BTL. Some require 30% for limited company applications or for certain property types. HMO properties within a limited company typically need a higher deposit still.
| Lending criteria | Personal BTL | Limited company BTL |
|---|---|---|
| Minimum deposit | 25% | 25% (some lenders 30%) |
| ICR stress test | 125% | 145% |
| Personal guarantee | Not required | Required , all directors |
| Minimum age (directors) | 21 (most lenders) | 21 (most lenders) |
| New company accepted | N/A | Yes , most specialist lenders |
| HMO within structure | Yes , with HMO licence | Yes , higher deposit often required |
Rates are higher than personal BTL. That is the consistent reality across the market. How much higher depends on the lender, your LTV and the property.
The specialist lender market for limited company BTL includes Fleet Mortgages, Paragon, Aldermore, Precise Mortgages, Foundation Home Loans and Landbay, among others. Some high street lenders also offer limited company products. Each has different criteria, different stress test rates and different approaches to new SPV companies.
Because the lender pool is smaller and the products are more complex, rate comparison without a broker is genuinely difficult. Rates change frequently, lender appetite shifts, and what was the best deal last month may not be this month. A whole-of-market broker with access to the specialist BTL market can compare live rates across all relevant lenders before anything is submitted.
The rate premium on limited company BTL is real. Whether the tax saving justifies it depends on your specific numbers , which is why an accountant needs to be involved before the decision is made.
We do not publish specific rate figures because they change frequently, sometimes daily. A broker can give you accurate live rate comparisons across lenders for your specific LTV, property type and company structure at the time of your application.
SPV stands for Special Purpose Vehicle. In a property context it is simply a limited company set up for one purpose: holding investment property. Nothing else happens in the company. No other trading, no other contracts, no staff. Just property.
Lenders prefer SPVs because they are clean and predictable. There are no other business liabilities that could complicate the security, no trading risks, and the company's finances relate entirely to the property portfolio. A trading company with an existing business poses different underwriting questions that most BTL lenders are not set up to answer.
| SPV limited company | Trading company | |
|---|---|---|
| Accepted by BTL lenders | Yes , standard requirement | Usually not accepted |
| SIC code | 68100 or 68209 | Other codes , problem |
| Other business activities | None , property only | Yes , complicates underwriting |
| Trading history required | No , new companies accepted | N/A , not accepted |
| Lender pool | Full specialist BTL market | Very limited |
If you already have a trading limited company and want to buy property through it, most specialist BTL lenders will not help you. The standard advice is to set up a separate SPV specifically for the property portfolio. Your accountant can advise on how to structure this alongside your existing business.
The process has more steps than a personal BTL application, but it is manageable with the right preparation.
Before anything else, speak to a qualified accountant who specialises in property. A limited company structure is not automatically more efficient and the decision needs to be based on your individual tax position. This step should happen before you speak to a mortgage broker.
Incorporate a Special Purpose Vehicle with SIC code 68100 or 68209. Companies House registration costs £12 online and can be done same day. Make sure the SIC code is correct from the start , it affects lender eligibility and can be difficult to change retrospectively.
Not all lenders offer limited company BTL and criteria vary significantly between those that do. A whole-of-market broker compares Fleet Mortgages, Paragon, Aldermore, Precise, Foundation, Landbay and others to find the most suitable lender for your SPV structure, LTV and property type.
You need company incorporation documents, SIC code confirmation, details of all directors and shareholders, and personal financial information for the guarantee assessment. Directors typically need to provide proof of income, bank statements and ID, the same as a personal mortgage application.
The lender assesses both the company and the directors. Credit checks run on all directors. A property valuation is instructed and rental income is stress-tested at the lender's ICR rate. Limited company BTL underwriting typically takes longer than personal BTL , factor in four to eight weeks from application to offer.
Yes, but the costs are often prohibitive. Transferring personally-owned buy-to-let properties to a limited company is treated as a sale and repurchase. That means Stamp Duty Land Tax at the applicable rates (including the 3% surcharge), potential Capital Gains Tax on the disposal from personal ownership, new mortgage arrangement fees, and solicitor costs.
For a single property the total cost of transfer can run to tens of thousands of pounds. For a larger portfolio it can be even more. The tax saving from moving to a limited company structure needs to outweigh these upfront costs over a realistic timeframe before the transfer makes financial sense.
In some circumstances, landlords may be able to use incorporation relief to defer Capital Gains Tax when transferring a property portfolio to a limited company. The rules are complex and depend on the nature of the portfolio and how the business has been run. This is specialist tax territory , HMRC has challenged a number of incorporation relief claims and the rules are not straightforward. A specialist property tax adviser is essential before going down this route.
Call 01422 354011 or use the form below. Woodhall Mortgages compares limited company BTL products across the specialist lender market including Fleet Mortgages, Paragon, Aldermore, Precise, Foundation and Landbay , and advises on the most suitable option for your SPV structure and circumstances.
Get Ltd Company BTL AdviceWoodhall Mortgages compares limited company BTL mortgages across the specialist lender market. We identify the most suitable lender for your SPV structure, LTV and property type, and manage the application from first conversation through to offer.
Initial discussion free. A broker fee of £299 is payable if you choose to proceed following a formal mortgage offer. This fee is non-refundable once charged. We may also receive commission from the lender. Most buy-to-let mortgages are not regulated by the FCA. Your property may be repossessed if you do not keep up repayments on your mortgage.
Get Ltd Company BTL AdviceWoodhall Mortgages is authorised and regulated by the Financial Conduct Authority (FRN 762513). As a whole-of-market mortgage broker, we consider mortgages from across the market, subject to lender criteria and product availability. Most buy-to-let mortgages are not regulated by the FCA. This article is for general information only and does not constitute regulated mortgage or tax advice. Corporation tax rates (19% to 25%) are subject to change , review annually. Tax treatment depends on individual circumstances. Always take independent advice from a qualified accountant before making decisions about property ownership structure. Your property may be repossessed if you do not keep up repayments on your mortgage. Last reviewed: June 2026.
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