Paying Tax as self employed or through a company


Tsvet Spasov

New Member
Hello and welcome to my topic,

I have a couple of questions regarding tax on rental income which I need to make clear.

I have read a few books on property lettings, property investments and how to be a landlord but I am still to find answers to my questions.

I own two properties in Romford, Essex on my name and I am renting both of them out.

I am paying tax as a self employed person but considering the tax changes I have established a limited company.

My plan was to give the properties to my company and start paying tax through my company, which is much lower. The problem is, is that I have to pay capital gains tax and stamp duty when selling the properties to my company, which will be a hefty bill. So my first question is: is there a way to avoid paying stamp duty and cgt in my situation when giving the properties to my company. I have read that, it is possible to do that if you have 3 or more properties and if you can prove that you spend more than 20 hrs work and you run them as a business. Can I transfer the mortgage to my company as well as my houses.

My second question is: is it possible to pay my company ONLY THE PROFIT from the rent that I receive and this way I can pay the taxes through my company. To me more specific, lets say I receive £1000 rent per Month, and I have £500 expenses (Mortgage and other expenses). I will pay £500 to may company (for property maintenance). So I make £0 profit as self employed therefore £0 tax as self employed. My company will make £500 profit and I can pay tax as a company which is much lower than being self employed.

I hope that makes sense and someone has a good advice for me.

Best regards,



Well-Known Member
I am not aware of the special situation which lets you transfer properties without paying stamp duty, etc. I was always under impression that a change in ownership triggered the stamp duty charge - also, I don't think you will be allowed to gift them, your company would need to pay for them whether this goes down as a debt in the accounts. I advise taking professional advice.

If in the future you held properties in a company and sold the company, this would be different. The company would still own the assets but the owner of the company would change hence no triggering of property stamp duty. An accountant would confirm this is still the situation.

As for the rental situation, unless you owned 50% of the property I doubt you could split the rent this way. There is a limit which you can pay yourself from a company in the UK which does not trigger income tax - check this with your accountant as I think it is more than the £500 you mention. Also, if you company makes money you can pay yourself dividends but I would investigate the tax free monthly payment option first.

Tsvet Spasov

New Member
Ok, thanks for the info. I will keep looking for the best option for me


Active Member
Remember that you will have your own income tax and capital gains tax allowances but a company does not. If you make £500 a month after expenses then this only equates to £6,000 a year - well below the zero tax threshold but surely not enough to live off?


Did you get anywhere with this one? Is there a tax efficient way around this?


Makes perfect sense to me - I have found the HMRC will not give advice prior to taking action with your investments. You take the action and then they will respond if need be - seems a bit of a waste of resources to me, why not just give the advice first and save everyone from wasting time, effort and money.

The HMRC is not your friend!