Hi random question. If I have 2 LTD companys one for trading such as retail and 1 for buying properties. What’s the best way most tax Efficient. 1) transferring money from trading ltd company to property LTD to buy property(loaning) or 2) taking Money out as dividends from trading company and then buying through the property ltd? With option 1 does this reduce any tax or it bad because the trading company’s accounts are messed up Incase you decide to sell
Hi Simon , what will be more beneficial for buying a commercial property in the UK now/predicting the new 2020 legislation buying as: an individual, offshore , or UK company ?
Hi Simon, is it possible to transfer mine and my wife's shares in a SPV (to hold HMOs or rent to SA properties) to a holding company (which will also be held by my wife and myself ) free of tax after the HMOs or the SA properties are up and running? I ask because lenders don't generally like to lend to properties who are being held by holding companies. Thank you.
Hi Simon You can transfer shares from you in exchange for shares in a holding company. There may be CGT liabilities based on the deemed profit (net assets) less CGT annual allowances. There may also be 0.5% Stamp Duty charges on the value of the shares in the old company for the holding company and 0.5% Stamp Duty for you on the holding company. The above may be mitigated for trade companies but it sounds as though you have an investment company. You will need to speak with other mortgage brokers about holding companies as ma y of our clients do get holding company mortgages. You are best advises to book a tax consult to gain further clarity now that you know the possibilities www.optimiseaccountants.co.uk
That's an interesting point. In Simon's example, surely the SPV or existing trading property company would own any assets such as houses etc. along with any attached liability, such as the mortgages? Why would the share structure of that SPV affect the ability to mortgage BTL properties? 🤔
Does it make sense to pay myself a salary out of a Holdings co if the holding co only earns dividends from tax point of view, if its subsidiary is located offshore?
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Hi random question. If I have 2 LTD companys one for trading such as retail and 1 for buying properties. What’s the best way most tax Efficient. 1) transferring money from trading ltd company to property LTD to buy property(loaning) or 2) taking Money out as dividends from trading company and then buying through the property ltd?
With option 1 does this reduce any tax or it bad because the trading company’s accounts are messed up Incase you decide to sell
You can have a loan between two companies. That would be the easiest approach, don’t take dividends as you will pay tax on it
Hello Simon, great video, thank you. Is this structure solely for properties and joint ventures?
You can use holding company structures in a number of scenarios
Doesn't the holding company have to pay corporation tax as a result of all the income from jv 1,2,3?
No, the tax has already been paid with the first company
Hi Simon , what will be more beneficial for buying a commercial property in the UK now/predicting the new 2020 legislation buying as: an individual, offshore , or UK company ?
This very much depends on each persons financial and tax position now and in this future
A generic answer would be wrong to make
Hi Simon, is it possible to transfer mine and my wife's shares in a SPV (to hold HMOs or rent to SA properties) to a holding company (which will also be held by my wife and myself ) free of tax after the HMOs or the SA properties are up and running? I ask because lenders don't generally like to lend to properties who are being held by holding companies. Thank you.
Hi Simon
You can transfer shares from you in exchange for shares in a holding company.
There may be CGT liabilities based on the deemed profit (net assets) less CGT annual allowances.
There may also be 0.5% Stamp Duty charges on the value of the shares in the old company for the holding company and 0.5% Stamp Duty for you on the holding company.
The above may be mitigated for trade companies but it sounds as though you have an investment company.
You will need to speak with other mortgage brokers about holding companies as ma y of our clients do get holding company mortgages.
You are best advises to book a tax consult to gain further clarity now that you know the possibilities www.optimiseaccountants.co.uk
@@UK-Property-Tax-Accountants Thank you, Simon. Much appreciated. We will book an appointment.
That's an interesting point. In Simon's example, surely the SPV or existing trading property company would own any assets such as houses etc. along with any attached liability, such as the mortgages? Why would the share structure of that SPV affect the ability to mortgage BTL properties? 🤔
Does it make sense to pay myself a salary out of a Holdings co if the holding co only earns dividends from tax point of view, if its subsidiary is located offshore?
You would need to get international tax advice on that. UK tax will not be applicable if you are not UK resident
In the first example, can I avoid being forced to take dividends by alphabet shares?
You do not need to take out dividends if you prefer not to
I think most lenders do not like SPV with holding company. How dobyoubgi round that problem with your children investment company
With great difficulty
There are some lenders out there but not many
These strategies work best with no mortgages