BUY2LETSAccording to an article in www.property118.com, HM Treasury have defined a business buy to let thus:

“For the majority of buy-to-let transactions, the borrower is making an active decision to become a landlord, an activity for which they will receive an income and for which they will be taxed as a business.

In addition, they will have to comply with a number of legal obligations placed on landlords, for example around fire and electrical safety standards and the use of a government-backed tenancy deposit scheme.  In the government’s view these are characteristics of a business rather than a consumer activity and therefore do not propose such borrowers need to be covered by an appropriate framework under the MCD.”

The H&S compliance (mind the trip hazard) and dodgy tenants to one side, the message is a simple one; a limited company is a great way of demonstrating that you’re running a business.  Besides which, owning BTL property via a company with the shares held in trust (a Family Investment Company) is highly tax efficient a great way making even more money.